How to trade with an oscillator

[GSSodhi]

Dear St Sir,
I am new in trading and read this thread 2 days ago. Yesterday I tried to apply this stochastic system on 5 Min TF. I short HDFC @rs.669 on stochastic flip from overbought area to neutral area but had to take a loss of 6-7 points. Was my entry wrong? Or this was exception? Kindly give guidance to me. I think I did not follow the candles high/ low closing rules thoroughly. If you have some free time Plz explain the rules in simple language which can be understood by the beginner like me.
Thanks in advance

 

[timepass]

Dear St Sir,
I am new in trading and read this thread 2 days ago. Yesterday I tried to apply this stochastic system on 5 Min TF. I short HDFC @rs.669 on stochastic flip from overbought area to neutral area but had to take a loss of 6-7 points. Was my entry wrong? Or this was exception? Kindly give guidance to me. I think I did not follow the candles high/ low closing rules thoroughly. If you have some free time Plz explain the rules in simple language which can be understood by the beginner like me.
Thanks in advance

Chart too small, but seems like there's some problem with your stochs. It was a clear buy with a divergence.

 

[SavantGarde]

Here is one of the two high probable entries I follow on Stochastic....!!!

SG

 

[GSSodhi]

respected sir, I am pointing out clearly on which point I tried to sold.

And Stoc settings are like this.are these settings are ok.

 

[timepass]

respected sir, I am pointing out clearly on which point I tried to sold.

And Stoc settings are like this.are these settings are ok.

The stoch settings seem to be ok.

That the stochs reverted to the OB zone without entering the OS zone is an indicator of strength and probably more upside.

PS : For uploading images, you should use a free image hosting website like www.imgur.com, www.tinypic.com or www.imageshack.com because there is a limit on attachments and you must be close to it. You can find the instructions for images uploading in this post.

 

[mangup]

Dear GSSodhi,

I suppose u r using Sharekhan S/w. The settings for stoch are as follows:-
Avg period - 3
% k period - 8
%k slow - 4

I think the settings used by u r some what diff than suggested by ST sir.

 

[Smart_trade]

Dear St Sir,
I am new in trading and read this thread 2 days ago. Yesterday I tried to apply this stochastic system on 5 Min TF. I short HDFC @rs.669 on stochastic flip from overbought area to neutral area but had to take a loss of 6-7 points. Was my entry wrong? Or this was exception? Kindly give guidance to me. I think I did not follow the candles high/ low closing rules thoroughly. If you have some free time Plz explain the rules in simple language which can be understood by the beginner like me.
Thanks in advance

The indicator is there for our guidence. We should not be a slave of the indicator. We have to see what the market is doing along with where the indicator is.

The place where you have sold , the market has not taken any upmove. The market becomes overbought only after it takes an upmove. In sideways movement also sometimes the indicator goes into OB/OS zones while market does nothing, just goes sideways , but such signals are false signals. You could have sold if the sideways zone gets broken on the downside.....which never happened and your sell trade was stopped out.

Smart_trade

 

[GSSodhi]

thanks ST, SG ,Tp

Kindly tell that when we should exit on a trade? any specific rule like entry or just when your target hit.
Sorry for taking your precious time

 

[4xpipcounter]

In other words, you don't even have to wait to get stopped out. If price does not move, but the stochs already have, then jump out, regardless if it is a small loss or a small gain. No use sweating bullets if you are not getting the desired price action after a few candles.

For the benefit of GSS, and I hope this is not out of context with this thread, but you may have wanted to look at the higher TF's just to see if it is in agreement. In looking at your 5-min chart and my gut feeling says the hourly, and maybe even the 15-min, went sideways after being OS, and so it was time for the spike north. It's my opinion that if you look through a vacuum at one TF only, you're looking for trouble.

The indicator is there for our guidence. We should not be a slave of the indicator. We have to see what the market is doing along with where the indicator is.

The place where you have sold , the market has not taken any upmove. The market becomes overbought only after it takes an upmove. In sideways movement also sometimes the indicator goes into OB/OS zones while market does nothing, just goes sideways , but such signals are false signals. You could have sold if the sideways zone gets broken on the downside.....which never happened and your sell trade was stopped out.

Smart_trade

 

[4xpipcounter]

No need to be sorry. For a beginner, you're asking good questions, so I'm sure no one is offended.

thanks ST, SG ,Tp

Kindly tell that when we should exit on a trade? any specific rule like entry or just when your target hit.
Sorry for taking your precious time