Defining the Gann Square of 9 Intraday Strategy’s Algorithm
As of now, there hasn’t been a comprehensive analysis or report available for this strategy. In this section, we will walk through a detailed, step-by-step backtesting process of this well-known strategy, providing a thorough and clear explanation at each stage.
Micro Conditions For Stabalizing the Strategy
In the realm of market dynamics, it is imperative to consider micro conditions that can significantly influence the stability and effectiveness of our strategy.
Market Volatility at Opening
- One notable factor is the inherent volatility observed at the commencement of trading hours. This heightened volatility can largely be attributed to liquidity fluctuations within the market.
- Additionally, brokers often face a surge in trade requests during this initial period, leading to a notable number of trade rejections as their systems contend with the influx of orders triggered at the market’s opening.
Optimal Entry Point
Consequently, it is prudent to consider an entry point at a later juncture, specifically at 10 minutes past the market’s opening, which typically aligns with 9:25 am.
It is essential to note that Gann’s strategy is not inherently bound by specific timeframes but operates autonomously.
Our choice of timing is rooted in a holistic analysis of market behavior and practical considerations influenced by technological constraints.
Exit Time Conditions
In the context of an intraday trading strategy, it is crucial to establish clear exit time conditions to optimize our trading approach.
Market Closing Time
Our focus is on intraday trading within the Indian market, where the trading day concludes at 15:30.
However, it’s essential to be aware that brokers have the discretion to trigger autosquare off procedures at unpredictable intervals after 15:15.
Note that – We still get 4-5x leverage on stocks trading in intraday. So, lets cose the trade at 15:10. Note that the choice of the time is arbitrary.
Optimal Exit Point
Considering the above, we recommend closing the trade at 15:10. It’s important to note that this specific time selection is somewhat arbitrary.
Despite this, it allows us to operate within a timeframe that avoids potential autosquare off actions by brokers.
So, in short, If the trade is running and does not hit stop loss o r target, it will be auto squared off at 15:10
Trade Closure Procedure
Defining the Gann Square of 9 Intraday Strategy's Algorithm
Lets say, We want to deploy the strategy with Reliance equities. So, What is the exact step by step procedure?
- We shall get the LTP (Last Traded Price) at the time of 9:25 AM.
- Then Put the Price in the Gann Square of 9 Calculator.
- It will give us two trades –
- Buy Trade Levels – Buy Above, Stop Loss, Target, and Pivot Levels for Trailing Stoploss.
- Sell Trade Levels – Sell Below, Stoploss, Target, and Pivot Levels for Trailing Stoploss.
- After getting the LTP at 9:25 AM and then getting the levels of buy and sell trade using the calculator, It will scan if the trade has triggered i.e. it has triggered buy or sell.
- Now, if the triggered has not triggered buy or sell till 15:10, We shall mark it as “No Entry”.
- Now, if the trade has been triggered till 15:10, it will scan for the other two conditions –
- If the trade has hit target.
- If the trade has hit stoploss.
- Now, If the trade has not hit target and stoploss till till 15:10, then it will exit the trade at 15:10 as it is intraday trade system.