Welles Wilder's Reaction Trend System:
Widely known as pivot points system
Caution:
This indicator works well in non trending shares only. In trending shares, using this
indicator for entry/exit decisions in not recommended. In such case use
Parabolic SAR.
Use "Welles Wilder's ADX" for trend determination.
Trading Rules:
- Go Long on "Buy Point" and do profit taking on "Sell Point" or book loss on "Buy Stoploss" and take new short position.
- Go Short on "Sell Point" and do profit taking on "Buy Point" or book loss on "Sell Stoploss" and take new long position.
- After taking a position, if corresponding Profit taking or Stoploss points are not hit on same day, carry the position to next day.
- On next day use Profit taking and Stoploss points for that day.
Hint:
If share price opens below "Pivot Point" there are more chances that you will get the "Buy Point" first and vice versa.
Disclaimer:
Stock market is a risky place and trading based on this indicator is totally on your own risk.
We assume absolutely no responsibility if you bear losses in your trading.
