Summary of "Class 2 | Bootcamp: Market Highs and Lows with Harinder | Cohort Dec'23 | 30 Dec"
Summary of "Class 2 | Bootcamp: Market Highs and Lows with Harinder | Cohort Dec'23 | 30 Dec"
This session, led by Harinder, is a comprehensive Bootcamp focused on understanding market highs and lows through technical chart analysis, risk management, and disciplined trading/investing strategies. The class blends practical market insights, psychological preparedness, and actionable trading methodologies suitable for various capital sizes.
Main Financial Strategies and Business Trends Presented:
- Capital and Profit Management:
- Use a fixed capital (e.g., ₹3 lakh) for trading to limit risk exposure.
- Example shared: Earning ₹4 lakh profit in December from ₹3 lakh capital by trading 15-20 minutes daily.
- Emphasis on protecting capital first, accepting losses quickly, and not risking the entire portfolio in a single trade.
- Use of SIP (Systematic Investment Plan) monthly to invest profits or surplus capital, focusing on long-term wealth building.
- Withdraw only what is needed for expenses, reinvest the rest.
- Risk Management & Position Sizing:
- Risk only a small percentage (e.g., 3%) of total portfolio capital on any single trade.
- Use trailing stop losses to protect profits and limit losses.
- Apply stop loss strictly; never trade without stop loss.
- Risk-reward ratio of at least 1:2 is preferred.
- Manage quantity of shares based on risk tolerance and stop loss size.
- Technical Analysis and Chart Patterns:
- Focus on price action and candlestick patterns, especially Doji candles as indicators of market indecision or reversal.
- Identification of “rabbit moves” (sharp rallies) versus “tricks” (false moves).
- Use of rally tops, breakouts, and support/resistance levels to decide entry and exit points.
- Emphasis on multi-timeframe analysis (monthly, weekly, daily) to confirm trends.
- Recognize powerful breakouts characterized by large “monster” candles.
- Avoid chasing trades without confirmation or setups.
- Use of trailing stop loss to lock in profits as the price moves favorably.
- Trading Psychology:
- Patience is critical; wait for the right setups rather than forcing trades.
- Accept losses as part of the game and don’t panic.
- Confidence builds with consistent application of strategy and risk management.
- Avoid greed; book profits when targets are met.
- Understand the market is a professional business; losses and gains are part of the process.
- Market Timing and Trade Execution:
- Trade primarily during strong rallies or confirmed breakouts.
- Avoid trading on weak or choppy moves.
- Intraday trading is possible but requires strict discipline.
- Positional trades (holding for weeks/months) require patience and proper stop loss placement.
- Use scanners and charting tools (e.g., Fyers) for stock selection but do not rely solely on them.
- Stock Selection and Portfolio Management:
- Focus on a limited number of stocks (e.g., 10 stocks) for SIP and portfolio building.
- Diversify but keep track of each stock’s performance and stop loss.
- Micro-cap stocks can offer big opportunities but require careful selection.
- Avoid overtrading or spreading capital too thin.
- Use of Technology and Tools:
- Use charting platforms and scanners for identifying setups.
- Open trading accounts via recommended links to access tools and mentorship.
- Regularly update and review charts, noting time frames and key levels.
Step-by-Step Methodology Shared:
- Daily/Monthly Trading Routine:
- Allocate fixed capital (e.g., ₹3 lakh).
- Spend 15-20 minutes analyzing charts and executing trades.
- Use trailing stop loss to protect profits.
- Book profits at a 1:2 risk-reward ratio.
- Withdraw only necessary expenses; reinvest the rest.
- Do SIP monthly on selected stocks.
- Chart Analysis and Setup Identification:
- Scan 50-500 stocks on monthly, weekly, and daily charts.
- Identify rallies, Doji candles, and breakout points.
- Confirm setups with multi-timeframe analysis.
- Set stop loss just below breakout or rally low.
- Enter trade only after confirmation candle.
- Monitor trades and adjust stop loss accordingly.
- Risk Calculation:
- Decide risk per trade (e.g., ₹500).
- Calculate quantity based on stop loss distance.
- Never risk more than 3% of total capital on one trade.
- Accept stop loss hits calmly and move on.
- Psychological Discipline:
- Practice patience and avoid impulsive trades.
- Learn from others’ mistakes and share homework.
- Maintain confidence and avoid chasing losses.
- Understand that losses are part of professional trading.
Category
Business and Finance
