System trading

System trading  is rule-based trading. The trading system decides which trades to make, regardless of current conditions.

Strategy = Previous Day Range Breakout

Rules for Buy Side.

1.  Buy When Previous day High is Broken. When 5 min candle close above Previous day High Buy order will be placed.

2. Stoploss 1 %

3. Target 3% or Book Profit at the End of Day.

4. Position Size should be calculated by taking risk of 1 or 2 % of Total Capital. 

Rules for Short Sale Side.

1.  Sale When Previous day Low is Broken. When 5 min candle close Below Previous day Low Sale order will be placed.

2. Stoploss 1 %

3. Target 3% Book Profit at the End of Day.

4. Position Size should be calculated by taking risk of 1 or 2 % of Total Capital. 

Stock Selection using data from www.nseindia.com

1. Download the daily data of Nifty 50 and FNO Stocks.

2. You will get csv file. open it in excel. Filter stocks based on change percentage.

3. Use conditional formatting - then New Rule - then Format only cells that contain - cell value between 0.5 and -0.5

4. This will highlight the stocks to be selected. 

Stock Selection 

Select Stocks whose percentage change is less than 0.5 % for the day. Use trend line to find Breaking out setup charts. 

Use chart patterns for sorting the best stocks. 

1. Ascending Triangle.

2. Descending Triangle.

3. Wedge.

4. Rectangle

5. Flag

6. Double Top.