The first pullback – Today is an Example

Today morning before the Open, in my earlier post I explained how a trend day can be used to trade using the first pullback. Luckily, today’s Nifty trading provides an excellent example of this concept. Here is the chart.

We must remember that real life trading is not perfect. In today’s chart. the pullback went deeper than zero. But while it was going below zero, prices were flattening out. The first uptick in the Oscillator gave us a buying opportunity. Today’s setup made money, but it is quite possible that another day, the market can keep on going down or up making the pullback into a new trend!

The way to successful trading is practice. Identify a few setups, then examine them every day and trade them. In the evening go back to your charts and try to learn what went right and what went wrong. Your practice will make you perfect.