Market Approach & Strategy, If Trading in Futures…

Greetings !

Today (3rd Jan 2018) we closed all Four Positions. ULTRACEMCO, NBCC, NIFTY & BankNIFTY

Booking Losses is not a bad thing. Now, No Position is Open. 100% in Cash.

Part One: “Market Approach” 

Trading in Derivatives is & will be volatile & choppy… Love it or Hate it, Choice is Ours.

“Love it” because you do not have position in Market. So, there is no fear of losing whereas others are on losing side of trade. Even, Few People would be more than happy when their known Person is losing Money especially when they advised otherwise…

“Hate it” because You do have positions in Market and on losing side of Trade.

Hypothetically, two characters can help us in understanding the above scenario and their names are Narendra & Rahul. This is pure case study, no one is right or wrong here.

~ Narendra – Decide Trend & builds-up Trading Positions whereas Rahul is watching him trade in disbelief and from safe distance by maintaining radio silence.

When Narendra starts incurring Mark To Margin Losses on open positions, then Rahul becomes more than happy & starts boosting around with confidence. On the other hand, Narendra was sticking with his Market view and maintained Stop-Loss for Open Positions; with willingness to re-adjust his Trading Strategy, if required any change, thereof.

~ Rahul started maintaining ratio silence again when realised that Market started going in Direction / favour of Narendra and He will book profit once again !


Becomes even louder when Narendra book losses, even negligible. Whereas, without wasting time, Narendra starts preparing for next entry / trade.

If you are a Trader then better to behave like Narendra. That’s the only learning Point.

Every Trader is well aware & accept above Statement to the core, but starts behaving irrationally when Prices are not in his / her favour.

Trade with enough Capital but Time Tested Strategy is a must. Finally, Patiently follow rules.

“Part 2 – Trading Strategy for Futures”:

FOREX, COMMODITY, BONDS, STOCKS are Interlinked & Co-related and because of that following things used to happened in Past, but not happening at-least for now,

~ Rupee Appreciation means Nifty Bullish and Rupee Depreciation means Nifty Bearish.

~ Rising Commodity Prices (GOLD, CRUDE) is bearish for Nifty

~ Rising Bond Yields means Inflation & Interest Rates are expected to go up, negative for Nifty

Remember, this is also an universal rule that Financial markets are dynamic and therefore evolving on regular basis. Otherwise, there is no explanation why world over Stock Markets are either Trading near all time high or keep making Fresh life time high after another.

Secondly, We respect more of Nifty 50 Stocks‘ individual buying and/or selling patterns measured from delivery cash volume to ascertain Nifty ‘s next directional view.

On top of that, using USDINR, HANGSENG and GOLD Price action to confirm the same.

That’s the only reason why we had advised buy in Nifty at 10550 (even) finding Nifty Over-valued on various Fundamental parameters & Technical Analysis matrix.

All in all, We believes to Trade only when Risk Reward Ratio is very favourable, By maintaining proper Stop-loss. Clients need to Bear with Intraday Volatility & ignore noise.

I understand it is difficult but try to maintain balance by neither getting disappointed when booking losses nor excited when Booking Profits. because, this is never ending cycle.

Closing Remarks:

Never Forget that Risk will always be there if you choose to be active in Stock Markets either through Cash Investments or Trading in Futures or both.

Therefore, Market approach and Trading (investment) plan should be crystal clear and must covers all aspects like Entry, Exit Rules given any Market conditions.

Thanks for Reading.

Team Rocket

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~ WhatsApp Number: 09900330558

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For any more details, doubt, feedback; Speak with Nilesh Jain on 09900330558