How to Boost Trading Profits In Four Easy Steps 1

How to Boost Trading Profits

In Four Easy Steps
Hi, I am Apurva Sheth.

I would like to congratulate you for taking the first step to boosting your trading
profits.

I am confident that reading this report (worth Rs 950) is going to be an extremely

knowledgeable and profitable experience for you.

I have written this report keeping the busy professional/businessman in mind. I want
to keep this report short, simple, and free of jargon.

I have linked the technical concepts and principles to my past articles. Feel free to
click on them and read those articles wherever necessary. Those who know the basic
concepts can simply read through this report in one go.

Over the course of this report, you will learn one simple and proven strategy to boost
your trading profits substantially. This strategy has the potential to multiply ones
profits not one or two but up to four and five times within month.

Yes! You read that right. The strategy could potentially boost ones trading profits four
to five times and that too in just four simple steps.

Now I dont want to keep you waiting anymore. So without further ado, lets get going!

2 How to Boost Trading Profits In Four Easy Steps

I am sure youve heard that the trend is your friend or that you should trade with the
trend many times from technical analysts and traders. Thats because its good
advice. Most money is made when markets are trending. And to benefit from the
trend, you have to trade in its direction.

But thats only one side of the coin. Markets do not trend all the time. They move up
and down quickly, and a large part of the time is spent sideways, consolidating the
gains or losses. There are times when the markets or stocks simply do nothing and
trade choppily in a very tight range, giving no indication at all of the trend.

Thats why it is said that whenever you spot a trend you should befriend it and trade
with it. But the catch is trends do not last forever. The trend is your friend only until the
end.

And thats when you have to step aside from the herd. If you dont, youll be
butchered in the slaughterhouse. This is where most people get it wrong.

They think that a stock in an uptrend will continue moving higher and ones in a
downtrend will continue to move lower forever. This is a big mistake.

Price moves in a cyclical fashion. It rises, falls, and then rises again. Theres a reason
Benjamin Graham quoted Horace on the first page of his magnum opus, Security
Analysis

Many shall be restored that are now fallen and many shall fall that now are in honor.

Stocks move up and down in predictable cycles. It pays off very well if you can
identify turns in these cycles. You need to be a contrarian to do that.

A lot of people think contrarian trading is simply doing the opposite of what the
majority is doing. You cant make money if you do this all the time.

You have to be a contrarian only when the trend is nearing exhaustion and about to
reverse. Let me warn you beforehand: Contrarian trading isnt for everyone. It requires
nerves of steel to go against the majority. And you need to have a proper method and
the conviction and discipline to follow it fully.

How to Boost Trading Profits In Four Easy Steps 3

But if you can do it, then it can be very rewarding as you will enter the trend before
anyone else does and can potentially ride it all the way up till it peaks.

Dont worry! I will share with you a strategy I have used successfully over the years.

But before I tell you about it, lets focus on momentum.

What is momentum?

Momentum refers to the velocity of a price trend. Velocity is speed in a given

direction. Speed describes only how fast an object is moving, whereas velocity gives
both the speed and direction of the objects motion. Traders use various indicators
that help them measure the speed and direction of a security. These indicators help
them make their trading decisions.

The RSI or Relative Strength Index is one such indicator. It is used extensively by
traders. It shows how strongly a stock is moving in its current direction. The RSI does
this by comparing the magnitude of recent gains to recent losses, generally over the
last 14 days.

The RSI oscillates between zero and 100. A security is considered overbought when
the RSI is above 70. An overbought reading suggests that the stock has run up a lot
and could reverse direction or halt. A security is considered oversold when RSI is
below 30. An oversold reading suggests that the stock has fallen a lot and could
reverse direction or halt.

The RSI is generally plotted in the indicator panel below the price. You may use our
advanced charts tool to plot the RSI on the stock of your choice.

4 How to Boost Trading Profits In Four Easy Steps

 Overbought and Oversold Levels in RSI

Source:- Spider Software

I have plotted the 14-day RSI in green in the indicator panel in the above chart. Under
normal course of trading, the RSI oscillates between 30 and 70 and occasionally
exceeds to 20 and 80. And sometimes the RSI crosses even these levels. Whenever
the RSI dips below 20, you should step aside from the herd and look for contrarian
buying opportunities.

Thats the time when you will get an opportunity to score big. Yes! Thats when you
will find extremely lucrative and profitable trades.

I have spent years in building and refining this strategy. And now I am going to reveal
it all to you in a step by step manner. Its so simple that you will understand it even if
you dont have any trading experience.

How to Boost Trading Profits In Four Easy Steps 5

 Boosting Trading Profits
in Four Simple Steps

Booster #1 Grouping
First, select a group of stocks you want to trade. Some traders prefer to trade
only Nifty 50 stocks while others are open to trading a bigger universe and opt
for a bigger group such as CNX 500 or BSE 500. I follow strict volume-based
criteria to define our universe of stocks before recommending them to our
subscribers. You can select stocks that have an average daily turnover higher
than Rs 2 crore for the last six months. This is to ensure sufficient liquidity and
depth in stocks.

Booster #2 Sorting
Once we have our group of stocks, I find out their latest RSI values. I use 14 days
as my parameter. I also find out the lowest RSI level in the last one, two, three,
and ten years.

The real work starts once we have the RSI values for all the stocks across
different time frames. Now you can sort stocks in ascending order depending on
their most recent RSI values. We are looking for stocks whose current RSI value
is below 20. These stocks have been beaten down abnormally hard.

Once I have a list of stocks ready, I compare their RSI values across different
timeframes. I compare the current RSI with the lowest RSI value recorded across
multiple time frames. If the current RSI reading is closer to any of these readings,
then the stock is worth looking at. The closer the current RSI is to the previous
lows, the better. In fact, I would go one step ahead and look for stocks hitting a
ten or 20-year low on the RSI. I would keep these stocks in my radar.

6 How to Boost Trading Profits In Four Easy Steps

 Booster #3 Filtering
Once I have a broad list ready, I filter stocks based on their chart patterns. I also
consider important support and resistance levels that can come into play and
halt the fall of the stock. Finally, I have a list of a select few stocks I would like to
enter near specific levels.

Stocks often do not move up immediately after the RSI has hit a fresh low.
Instead, they continue to drag lower, but the RSI moves up. The RSI forms a
higher low when the price hits a lower low. This is a diverging signal. Here the
momentum indicator does not conform with price. This is a sign that a reversal
could be coming anytime soon.

Booster #4 Execution
Finally, we can enter our position when everything is in place and the price
action gives an indication of a bottom reversal. We can look for confirmation
from candlesticks on lower time frame to enter the stock with a suitable initial
stoploss. (Trading with a stoploss is an absolute must. A lot of traders have gone
bust trading without a stop.)

Nobody knows for sure how long a trend will last. So the best way to ride the
trend till it peaks is to use a trailing stoploss. You can trail the stoploss higher
once the position moves in your favour. You can also set a trailing stoploss at a
fixed percentage below the most recent high.

For example, if you bought a stock at Rs 100 and it moves up to 150. You can
now keep a trailing stoploss at 135, 10% below 150. If the stock closes below 135,
then you exit. If it continues to move up, then you revise your trailing stoploss
higher. Simple, isnt it?

Revising the stoploss helps you to stay with the stock as long as it remains in an
uptrend. It also protects your profits in case the trend reverses.

How to Boost Trading Profits In Four Easy Steps 7

 My Strategy Live in Action
Here are few examples of how to implement this strategy and capture large trends
and bigger profits. Now let me tell you beforehand that I have recommended all the
three stocks listed below to my Swing Trader subscribers.

[Editors Note: Swing Trader is my premium short-term stock recommendation service

where I guide subscribers to the best trading opportunities that could potentially
generate 6%-20% returns in just weeks.]

I have used the RSI extensively to book many short-term gains in the range of 6-20%.
But I believe that with some changes the same strategy can capture larger trends and
bigger profits.

Now heres the first stock in the list - Punjab National Bank. I recommended this stock
to my subscribers in May 2016.

Trade Recommended in PNB

Source:- Spider Software

8 How to Boost Trading Profits In Four Easy Steps

PNB had topped out near 230 in December 2014 and then fell into a vicious
downtrend for the next year and a half. It hit a seven-year low of 69.25 in February
2016.

By April 2016, it managed to bounce back about 30% from those lows, hitting a high
of 92.15. But it failed to sustain at those levels and moved close to the previous lows.

However, the daily RSI diverged sharply from the price. It hit an all-time low of 11.32 in
January 2016, but stayed above 30 levels in May. This was a classic example of a
bullish divergence, which suggested a reversal could be possible immediately. So I
recommended entry at a price of 74 to our subscribers.

Generated Profits of 18.24%

Source:- Spider Software

Our trade went live on 26 May at 74. Our stoploss for this trade was 69, 6.76% below
our entry price. And our initial target was 84, 13.51% above our entry price.

The stock caught momentum on 8 June and ended the session above 80. By then I
had revised our stoploss up to 75.45 and our target to 87.50.

On 14 June, the stock opened gap up and ended the session at 89.90. We closed this
trade at our revised target price of 87.50 for gains of 18.24%.

How to Boost Trading Profits In Four Easy Steps 9

Now 18.24% gains in nineteen days isnt bad at all. But I wasnt happy about it.

And thats because of what happened to the stock after we booked out. The stock
continued to rally even higher and hit a high of 137.85 on 18 July 2016. This was
almost 85% above our entry price of 74.

Does this mean that there was a fault in our process?

Absolutely not.

Our process at Swing Trader is designed to capture short-term swings ranging

anywhere between 6% and 20%. These swings can occur anywhere in an uptrend.

But if you want to boost your trading profits, then you will have to capture big
trends instead of small swings. And the best place to capture big trends is when they
are reversingfrom down to up.

As you know, stocks do not move in one direction for a long time. After a prolonged
downtrend, they consolidate and move up. This is an ideal place to get in a stock for
bigger returns.

Incidentally, we identified PNB just when it was about to reverse from a long-term
downtrend to an uptrend.

We identified the long-term reversal correctly but exited as our target was met. With
the help of RSI, you can identify a reversal easily, but you cant tell how long an
uptrend will last.

So the best way to benefit after identifying a long-term reversal is by using a trailing
stoploss and holding the stock as long as it stays above the trailing stoploss. If the
stoploss is hit, you can exit. If it doesnt, you can ride the whole uptrend.

Now lets use a trailing stoploss of 10% in PNB and see how it changes the equation.

10 How to Boost Trading Profits In Four Easy Steps

 Triple Booster to Profits

Source:- Profit Hunter

I have plotted the daily closing price of PNB in blue in the above chart. The line in
orange is a 10% trailing stoploss calculated from the highest closing price. So as the
stock moves up the trailing stoploss moves up along with it.

We have marked an entry in PNB at a price of 74 based on our earlier

recommendation. But instead of holding it with a specific target, we could hold it with
a trailing stoploss of 10%.

This triples the profits from 18.24% to 61.41%. PNB touched a high of 137.85 on 18 July
2016 and closed below the trailing stoploss level of 122 on 22 July 2016.

One should exit the stock the day after it closes below the trailing stoploss level. In
this case, the next trading day was 25 July 2016. The stock opened at 119.45. That
becomes our new exit price, which is 61.41% above the entry price of 74.

Isnt this impressive?

How to Boost Trading Profits In Four Easy Steps 11

Now lets check out another trade I recommended to my Swing Trader subscribers. I
recommended Canara Bank on 28 May 2016, a few days after I recommended PNB.

Trade Recommended in Canara Bank

Source:- Spider Software

The stock hit a high of 217.40 in April 2016. The daily RSI hit an all-time low of 9.90 in
January 2016 and was recovering from those levels. The RSI was consistently forming
higher lows, suggesting improving momentum.

The stock was also forming an ascending triangle pattern on the daily charts. The
daily volumes over the last few days were above average, suggesting demand at
lower levels. Most of the technical parameters signaled a reversal from a medium to
long-term perspective.

The level of 210 to 220 acted as support in 2014. The same level could now act as a
resistance, so waiting for a dip to enter looked like a good strategy. I recommended a
buy at 196 when the CMP was 206.40 on May 31.

12 How to Boost Trading Profits In Four Easy Steps

 Generated Profits of 14.8%

Source:- Spider Software

The stock eventually touched 196 two days later on June 2. This trade went live with a
stoploss of I85, which was 5.61% below our entry price, and a target of 240, which
was 22.45% above our entry price.

The stock consolidated for a while initially and picked up momentum gradually. By 7
July, I revised our stoploss to 225 and target to 250.

This trailing stoploss was eventually triggered on 8 July, and this trade was closed at
225 with gains of 14.8%.

I kept a tight trailing stoploss as we were only interested in short-term swings. But
what if we would have kept a wider stoploss of 10% with an aim to ride the larger
trend?

How to Boost Trading Profits In Four Easy Steps 13

 Profits Swell Three Times Once Again

Source:- Profit Hunter

Here again I have plotted the daily closing price of Canara Bank in blue and 10%
trailing stoploss level in orange.

We have marked an entry in Canara Bank at a price of 194 based on our signal. But
instead of holding it with a smaller stoploss, we keep a wider stoploss of 10% and trail
it higher as the stock moves up.

A wider trailing stoploss gives breathing space and keeps us in the trend for a longer
time. Minor fluctuations do not affect the long-term trend.

As a result, we get a new exit signal only after the stock closes below the stoploss
level of 302 on 2 November. We mark a new exit at the opening price of 294.25 on 3
November, one day after the trailing stoploss is hit.

This is 50% above our entry price of 196 and more than thrice the profit of 14.8%.

14 How to Boost Trading Profits In Four Easy Steps

Now lets check out one last example.

Trade Recommended in IDFC Bank

Source:- Spider Software

IDFC Bank was a new entity created by its parent IDFC in October 2015. IDFC Bank
listed on the bourses in November 2015. The stock quickly moved from its listing day
high of 68 to a low of 43.10 in January 2016.

Since then the stock was coiling in a large triangular pattern. However, it didnt break
below its previous low of 43.10. This level had acted as support in March and it
seemed like it could again help to the bulls in July.

The daily RSI was strengthening and forming bullish divergence with price. The daily
volumes were also on the higher side, indicating buying interest at lower levels.

Thus, I recommended a buy with an upper limit price of 46.45 and a target of 11.95%
and a stoploss of 5.27% on 4 July 2016.

How to Boost Trading Profits In Four Easy Steps 15

 Generated Profits of 11.95%

Source:- Spider Software

Our trade went live on 5 July at 46.45. Our stoploss for this trade was 44 and our
target was 52.

The stock moved up to 48 levels by 11 July. But on 12 July, it took off. The stock was
up more than 12% on that day. It hit a high of 53.90.

Our target of 52 was achieved, so we closed for a handsome profit of 11.95% in just
seven days.

16 How to Boost Trading Profits In Four Easy Steps

 Profits Amplified Five Times

Source:- Profit Hunter

Here again, you can see the price in blue and trailing stoploss level in orange. We
mark an entry at the same price of 46.45 in IDFC Bank and hold it with a trailing
stoploss of 10%.

The stock trades on a flattish note for two months after the initial spike in the first
week of July. But it shoots up again like a rocket in September and zooms up to the
stratosphere without any break in between.

The stock hits a high of 83.40 on 29 September for a jump of 40% in the month of
September alone. It traded sideways for the next few weeks and even came in kissing
distance of closing below the stoploss in October but held on above it.

Finally, it closed below the trailing stoploss level of 73 on 4 November. We mark a new
exit from the stock at the opening price of next trading day which is 74.6.

This is whooping 60% from the entry price of 46.45 and nearly five times our profit of
11.95%.

Isnt this a simple yet highly effective way to boost your profits?

If youre nodding in affirmation and excited to use this strategy, please read on before
you go and apply it.

How to Boost Trading Profits In Four Easy Steps 17

 Boosting Profits in 2017

Now you have already seen what I have done in the year 2016. My recommendations
have generated returns like

18.24% in 19 days

15.79% in 6 days

11.15% in 10 days

And thats not all. We started 2017 on an excellent note as well. We have generated
returns like

13.29% in 12 days

8.8% in 20 days

10.77% in 4 days

But I am not happy with these returns. There is scope to generate even bigger
returns. I have shown you four simple steps using RSI to boost ones profits. I have
spent years in refining and building this strategy, and now you can use it right away.

But that doesnt mean its all you should look at. If you want to pick stocks that can
boost your profits, you have to pick stocks on the cusp of a long-term reversal.

And that requires a lot of work and knowledge of how the strategy works. Apart from
this you should also have the time and be willing to put in those efforts to generate
this type of returns.

A lot of people may be lacking knowledge or time or even both. If you are amongst
them then you should not worry. I am currently working on something that will help
you with this. I will share the details very soon.

Meanwhile, continue reading the Profit Hunter

Happy Trading.

18 How to Boost Trading Profits In Four Easy Steps

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How to Boost Trading Profits In Four Easy Steps 19