4 Best Trading Strategies for Profitable Trading

4 Best Trading Strategies for Profitable Trading

Introduction:

When it comes to earning money from trading, having a solid trading strategy is essential. In this article, we will discuss four of the best trading strategies that can help you maximize your profits. These strategies involve the use of various technical indicators and can be applied to different time frames. Whether you are a day trader or a swing trader, these strategies can be tailored to suit your trading style.

VWAP and Exponential Moving Average Strategy
VWAP and Exponential Moving Average Strategy

Strategy 1: VWAP and Exponential Moving Average:

Our first strategy involves the use of two indicators, Volume Weighted Average Price (VWAP) and Exponential Moving Average (EMA). These indicators can be found in most charting platforms and are commonly used by traders, Example- Tradingview. By applying these indicators and setting specific parameters, we can identify potential buying opportunities in a bullish market.

  • Use a 5-minute time frame for this strategy.
  • First, ensure that the first candle after the market opens is green.
  • Check that the VWAP line is going through the middle of the green candle.
  • Confirm that the 7-period EMA is below the current share price.
  • Place a stop loss below the lowest point of the green candle.
  • Set a target up to 2 times the stop loss or use a trailing stop loss.

This strategy allows you to take advantage of bullish trends in the market and can lead to profitable trades.

Bearish Trades with VWAP and EMA Strategy
Bearish Trades with VWAP and EMA Strategy

Strategy 2: Bearish Trades with VWAP and EMA:

Our second strategy focuses on bearish trades. By simply reversing the conditions of the first strategy, we can identify potential selling opportunities in a bearish market.

  • Again, use a 5-minute time frame for this strategy.
  • Instead of a green candle, look for a red candle after the market opens.
  • Check that the VWAP line is going through the middle of the red candle.
  • Ensure that the 7-period EMA is above the current share price.
  • Draw a line from the low of the 5-minute candle and enter the trade when it breaks.
  • Place a stop loss above the highest point of the red candle.
  • Set a target up to 2 times the stop loss or use a trailing stop loss.

This strategy allows you to profit from falling prices in the market and can be a valuable addition to your trading arsenal.

Sideways Market Trading Strategy
Sideways Market Trading Strategy

Strategy 3: Sideways Market Trading:

If the market is moving sideways, you can use this strategy to identify potential breakout opportunities. This strategy can be applied to different time frames, but it is recommended to use longer time frames to avoid fake signals.

  • Identify a stock that has been trading within a range for an extended period.
  • Draw lines from the tops and bottoms of the price range.
  • Enter a trade when the market breaks above or below the range.
  • Place a stop loss above or below the breakout candle.
  • Set a target up to 2 times the stop loss.

This strategy allows you to capitalize on breakout opportunities and can be used for both intraday and swing trading.

Moving Average Crossover Strategy

Strategy 4: Moving Average Crossover:

Our final strategy involves the use of two moving averages and volume to identify trend reversals. This strategy can be applied to different time frames and is especially effective for swing trading.

  • Add a 50-period and a 200-period exponential moving average to your chart.
  • Enter a buy trade when the 50-period EMA crosses above the 200-period EMA.
  • Confirm the trade with increased volume.
  • Enter a sell trade when the 50-period EMA crosses below the 200-period EMA.
  • Again, confirm the trade with increased volume.

This strategy allows you to capture trend reversals and can be a valuable tool for swing traders.

Conclusion:

By incorporating these trading strategies into your trading plan, you can increase your chances of making profitable trades. Remember to always use proper risk management techniques and conduct thorough analysis before taking any trades. Trading can be a rewarding endeavor, but it requires dedication, discipline, and continuous learning. So, start implementing these strategies and watch your trading performance improve.


Advanced and Profitable Trading Strategy Free PDF Download:

Q. Which option trading is most profitable?

Ans: Straddle is considered one of the best Option Trading Strategies for Indian Market.

Q. What is the safest trading strategy?

Ans: The safest option strategy is one that involves limited risk, such as buying protective puts or employing conservative covered call writing.

Q. What is No 1 rule of trading?

Ans: Always Use a Trading Plan.

Q. What is the Bank Nifty no loss strategy?

Ans: The Bank Nifty no loss strategy is designed to protect traders from incurring significant losses while participating in the Bank Nifty index.

Q. What is the most successful form of trading?

Ans: Day trading offers rapid profits but demands quick decision-making, while position trading requires patience for long-term gains. 

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