Summarizing the #Tax you have to pay while #Trading and #Investing in Stock Market.

Sharing it as ITR Filing for last Financial Year has started.

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#Darvas #Box is a simple and interesting strategy used by the trader. It is a momentum strategy with no technical indicators.

This learning thread would be on "Darvas Box Strategy"

Like and Retweet for wider reach and for more learning thread in the future.

@AmitabhJha3

1/11

Darvas Box is named after Nicolas Darvas, who was a dancer and self-taught investor.

He discovered "Box Theory" after gaining experience from the market and he believed that the shares which move up and down the chart move in a specific box pattern.

2/11

There are some condition to use Darvas Box and we will discuss only buy strategy:

1. Stock should be trading near all time high levels
2. Fundamentals of the company should be good
3. Volumes play a crucial role

Prefer to use it daily time frame and above.

3/11

When the price is near all time high levels, if price consolidates then there is a range or box formed having a upside ceiling and downside floor. Price consolidates in this range before breakout.

Volumes during breakout is very important and it should be high.

4/11

Let's see some example now.

Dmart was trading in a range of 1955-2438 for six months.
After breaking this range upside, DMart price rallied from 2500 to 3200+ (Rally of 28% in 3 months).

During breakout volumes should rise and it should spike up.

5/11

If you are are not aware of these 4 indicators then YOU are learning TRADING the wrong way !

2nd one is the penultimate of all 🧵

Remember these are reference indicators and should be used as added confirmation only and only with price and volume.

Summary/:
1. RSI
2. 200DMA
3. 21 EMA
4. Pivots
5. AVWAP

Pre summary :
1/What is the indicator
2/Uses of indicator
3/Disadvantages of indicator
4/Optimal use of indicator

The Relative Strength Index (RSI), developed by J. Welles Wilder, is a momentum oscillator that measures the speed and change of price movements. The RSI oscillates between zero and 100. Traditionally the RSI is considered overbought when above 70 and oversold when below 30.

1. Change in price momentum.
RSI is mainly used to gauge momentum of a trend.

Anything above RSI 60 is bullish and below 40 is bearish.

I’ve went from knowing nothing about Trading to currently mentoring 400+ people!

30,000+ hours of experience summed up in 30 lessons.

A thread🧵

1/
The amount of time you spend in the market trading/investing will always give you more insights than reading 100s of books

2/
If you treat markets as a sole income generator, your chances of underperformance due to compulsion of income generation will always be higher !

3/
4-5% a month is always better than chasing unlimited downside risk strategies that promise you 40-50%

4/
Your chances of making money in a stock sitting near 52wk high will always be more than a stock sitting at 52wk low

If you are spending Rs 40-50k on research related to Trading/investing.

Hold on, these 7 tools/websites are absolutely free ::

A thread 🧵

1/ @tradingview :

TradingView is the best platform for doing chart analysis. Mobile app and software are also available which a user can use.
There are thousands of indicators and tools available for

2/ Chartink Screener:

It is the best screener that is available to scan and filter stocks out of 1000+ stocks. There are free screeners available and you can create your customized screener.
They also have a dashboard where you can add multiple

3/ Opstra:

This is a good platform especially for futures and options traders. They can analyze payoff of their position, probability of winning, max profit and max

4/ @screener_in :

Screener is one of the best platform to filter out stocks based on the various fundamental parameters. Investors shouldn't miss this and as it will help them in analyzing

Brief insight for those who has no patience to watch an hour long video 🤗

Here is the

Complete Guide to Swing Trading
A Mega Thread 🧵
With Live Charts and Examples

Comment " Yes " and Retweet if You want PDF version

Criteria for Swing Trading :

Uptrend HH HL Structure
Stage 2 Uptrend
Volume Expansion during Breakout
Pullbacks with Lower Volume
Base Formation ( Rectangle , Vcp Etc)
Relative Strength > 0
21 ema > 50 ema > 200 ema
Stocks near 52 week High
Stocks near All time High

1/n

What is HH HL Structure ?

1. A stock Maintains Bullish Momentum till it holds the last Swing .
2. Swings is an area from where stock reverses
3. As it is widely known Trend is your Friend A structure of Higher High is good for buying as overall momentum is in buying side

3/n

A structure of Lower Highs is good for selling side , as each bounces will be sold off
Previous Swings will now act as Resistance in Downtrend and Support in Uptrend

4/n

Enter Stage 2 Uptrend
Stage 2: The Ideal Buy Point for Traders Traders should look for bases within an existing Stage 2 uptrend and focus on breakouts on volume. Intermediate term traders can also use investor buy points
5/n

Insiders and operators can hide everything from you except VOLUME,
Yes, Volume is the most useful indicator in Price Action Trading.

A thread🧵 on Volume Analysis and Interpretation -

Price increases + Volume increases = Bulls have strength

Price decreases + Volume increases = Bears have strength

Price increases + volume decreases = Bulls don't have strength, won't sustain higher levels

Price decreases + volume decreases = Bears don't have strength.

Points to Remember -
1. Big breakouts start with big VOLUME always.

The Higher the volume + Higher the range = the bigger will be the move.

2. When the stock consolidates and rejects from the higher price, volume is always low.
And when it gives the decisive breakouts, The Volume is stronger than the whole consolidation..
See the attached chart.

3. When the trend changes from Positive to Negative, Or Negative to Positive, It is always supported by strong Volume..
See the volume when the stock was declining and going in a downtrend from the uptrend in the pic below.

Even the biggest handles with 100k+ followers get this simple thing wrong in charting!🤦‍♂️

This is the most important thing especially if you are analysing long term charts!🧐

So, let's get this right today!

USE LOG CHARTS 📈 FOR ANALYSING LONG TERM CHARTS!

Let’s go🧵...

1⃣ Wait, What's Log chart?

Before I define Log chart, let's look at the chart you are using daily - 'The Linear Chart'

- Linear chart is used by default in most platforms. This is probably why you never knew log charts

Wait, don't click on 'log' yet before you understand it...

2⃣ ok, so what does Linear chart mean?

Take a look at the image
- The y-axis is separated equally by 1000 points starting from 0 to 11000.
- So, any linear chart would have its y-axis equally separated by 'N' points always

And... that's where the problem lies...

3⃣ But, I don't see any problem?🤔

Ok ok.. let me explain...

- Can you look at this #TATAELXSI chart & tell me the price in '99 when it was listed? No!
- Can you draw a proper trendline in this chart? No!

Reason is because of the price congestion between '07 to '20...

4⃣ What else?🧐

- Whenever there is a price change in an instrument & it's drastic it'd be difficult to analyse on a linear chart

- Look at this example of #BTCUSD. What happened in 2021(refer to the red box)? 🤔

All this is because of the equally spaced Y-axis!

hmmm... ok🙄