Entry Tactic: This is how I enter a low-risk strong stock
Complete system: Pre-entry prep to alerts to execution. Live examples
2 weeks ago, I showed you how I prepare my watchlist containing relatively strong stocks.
Last week, I showed you how I identify those strong stocks in low-risk areas.
Today, I will show you how I enter these stocks.
Pre-entry preparation:
Preparation is essential to trading success.
There are 2 ways to ensure you are alerted when a low-risk entry is triggered in a strong stock.
Manual high-priority list:
You prepare a list of 10-15 (or more. Depending on the number of stocks you can handle at a time) high-priority stocks a day before (or on the weekends).
You set alerts on the Tradingview (or your Broker. Zerodha allows you to set alerts at particular price points).
Here is my high-priority list for 26-April-2024 below:
I did trade 2 stocks from the list: DP Abhushan and OIL. (These are WhatsApp updates to my private group, HPA. Details at the end of the article)
Use a high-probability entry scanner:
If you have a scanner that scans for stocks ready to be bought when hit, you can run this. Set an alert system on your email, phone, desktop, or telegram.
I use a high probability breakout scanner, The Homma Khela Hobe (HKH) 2.0, and the Homma Pullback Entry scanner as entry scans. I have directed these alerts to my telegram channels.
Today’s hits on the HKH-2.0 scan are listed below:
Today’s HPE (Homma Pullback Entry hits):
To summarize, whichever route you take. You need a system to alert potential entry candidates in real-time. (Not all names will be entry-worthy though)
Once you have this system in place.
The next step is to assess the stock price and punch the entry order.
There are 2 ways:
(PS: notice that the 2 stocks I traded today were already in my high-probability watchlist and also were alerted on the Open by my Homma pullback Entry scanner. This is the power of having a system. The decision-making becomes very fast This is key to trading success.)
GTT vs Manual Entry:
GTT entry: Limit Order
You can place a limit order at a pre-determined price (some percentage points above the entry pivot). This will suit you if you have done your homework with a manual high-priority list the day/week before.
This is also suited to a working professional with a day job who cannot attend to the market during trading hours.
Manual Entry:
A) When the stock crosses above your entry pivot, an entry is ON. This is an early breakout entry.
B) Alternatively, you can wait for the price to close above the entry pivot in the 30-minute timeframe. This would still be an early entry but with some degree of confirmation.
An early entry gives you a better price and lower risk but a higher probability of failure.
An entry with price confirmation gives you a slightly extended price but a lower probability of failure.
C) There is a 3rd way to enter the stock stock manually.
On the pullback confirmation after the breakout.
Almost 50% of the stocks that break out will eventually pullback to the breakout area or near. When it bounces and starts to trend up, it provides the 3rd kind of entry point.
This provides both confirmation and low risk.
But is there a catch?
You bet, there is.
There is a 50% chance that you will miss the entry as 50% of the stocks will not pull back immediately.
Now, let’s look at some recent examples.
DP Abhushan trade:
Entry type: Manual Early entry
The entry signaled at the open.
I waited for the 3-minute open range to close.
Pulled the trigger as soon as the stock closed strong and above the breakout entry pivot.
OIL:
I had 2 entries on OIL. Both manual.
1st entry was an early entry. Right after the 1st 3-minute candle closed strong with a Gap up.
The second entry was a confirmation entry on the breakout of the intra-day base (It had VCP characteristics and all other characteristics of a great base. Volume dry-up, volatility contraction, etc).
This gave me a very tight stoploss (less than 1%).
This was pre-planned.
See my alert on my private group.
Entries marked:
These are very early entries.
Let’s look at another example where I show an entry with confirmation in a 30-minute timeframe.
HUDCO:
Alert triggers at 205.5 @10.23 am
As soon as the 30-minute candle closes (one can also use 60-minute or 75-minute), an entry is ON. Simple
This entry in HUDCO was also alerted on the HPA group.
That’s all for today mate.
Believe me when I say this. “A trading system is the key to success”.
You don’t have to trade this exact system, but you have to have a SYSTEM.
A system that suits your NEEDS, PERSONALITY, and BIASES>.
Once you have it, you have to practice it each day.
Better it, each day.
Trust the process each day.
I show my process and system day in and day out.
And guide the Homma Private Access (HPA) members to build their own.
HPA has been the shortest way towards being consistently profitable for more than 200 traders/investors.
There are 2 ways I can help you:
Join the Sakatas Homma TA masterclass for beginners:
A complete course containing 8 Hourly sessions. Once a year.
To register for the next live masterclass, please fill out this form.
Watch the 1st session of the Autumn 2023 masterclass.
To access the full 8 sessions, contact us via WhatsApp @ 9481506784
Homma Private Access membership:
HPA is a subscription-based educational service (on WhatsApp). Benefits include:
Daily Market Breadth, Momentum, Sector Rotation, and Relative Strength Update.
Access to all my scanners including the BBB (buy before breakouts) scanner, and the Homma Khela Hobe 2.0 scanner.
Access to my proprietary Breadth-Momentum-Relative Strength & Sector Rotation dashboards.
Access to my Trading view indicators: Homma Khela Hobe, Buy before Breakouts (BBB), Homma Endgame, etc.
Access to live Telegram alerts to Homma Khela Hobe, Homma Pullback, and TGP scanners.
HPA Weekly: Hourly weekend deep dives and Q&A.
1-year access to The Technical Take premium.
Live alerts to high-risk-reward setups breaking out.
Live updates on my portfolio and the trading setup rationale.
Access to my high probability watchlist.
Yearly membership of 15000/- INR only.
UPI payment & WhatsApp @ 9481506784.
Yours
Sakatas “systems” Homma.
Homma Low-risk Pullback scanner