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How to improve your trading in 300 or 600 days,
not in 30 or 60 days as profitability needs time, conviction, practice, discipline.
Most traders don't need another indicator or another stock tip. They need rules they can actually follow.
1. Trade only one setup
Choose one setup you understand deeply. Don't take trades outside your system just because they look attractive.
2. Define your risk before every trade
Risk only 0.25–1% of portfolio capital per trade.
Position size should be calculated from the stop-loss—not from how much money you want to invest.
3. Trade with the market trend
For positional trading, take aggressive long trades only when the broader market is in an uptrend.
Reduce exposure when the market becomes weak or choppy.
4. Have a predefined entry, SL and exit rule
Before entering, know:
Where will I buy?
Where am I wrong?
How much will I lose if I'm wrong? thats your RPT
When will I book/raise the stop?
5. Review every trade
Maintain a trading journal. Review winning and losing trades every week/month.
Look for repeated mistakes, not individual outcomes.
6. Stop trading on other people's opinions
Tips, X posts, Telegram calls and YouTube views can generate ideas.
They should never replace your own process.
7. Focus on execution, not daily profits
Don't set a target like "I must make ₹10,000 today."
Your goal is to execute your system correctly. Profit is the outcome.
8. Increase risk only after consistency
Don't increase position size because of a few winning trades. Increase it gradually only after you have demonstrated consistent execution and controlled drawdowns.
Regularly following the discipline can change your trading more than 30 new indicators.
Simple process = proper position sizing + risk management + patience = survival first, consistency next, compounding eventually.
Currently Momentum portfolio has 7 positions:
Trading Is Not About Being Right. It’s About Adapting Fast as per market.
🚦 Spot the signals.
⚠️ Respect the warning signs.
🔄 Change course when the market changes.
The market doesn’t care about your opinion. It rewards your ability to read the price action, manage risk, read market condition and act without ego.
Don’t fight the market. Adapt or get left behind.
Survival first.
Consistency next.
Profits follow.
due to poor market condition, haven't posted any trade on X and hardly taken few trades with low RPT
Weak market was very much evident from the time it crossed below 21 EMA on daily chart.
No trades if index is below key moving averages.
xitter.cf/deepakdgy/status/21038…
Replying to @deepakdgy
NIFTY50 conditions
What happens when main index is strong or weak in terms of 10/20EMA?
I tested whether the NIFTY 50 market condition, using its 10 EMA and 20 EMA, can improve the quality of entries generated by the Smallcap250 Daily 21 EMA + 3% SL strategy.
What the study tells us
1. NIFTY EMA condition improves entry quality.
When NIFTY is above both 10 & 20 EMA:
- Win rate improves: 47.2% → 49.2%
- Average trade improves: 2.98% → 3.72%
- Profit factor improves: 5.83 → 7.57
- Maximum drawdown improves: -8.84% → -7.53%
So the Smallcap 250 signals are generally higher quality when the broader NIFTY 50 trend is healthy.
2. But the hard filter reduces CAGR.
Trades fall from 178 → 122, and
CAGR falls from: 29.81% → 24.86%
This happens because the filter removes some trades that would eventually become profitable.
Most important observation
When NIFTY 50 was below both 10 EMA and 20 EMA, the Smallcap entries that occurred during those conditions had:
- 39.4% win rate
- +0.79% average trade
- 1.96 profit factor
That is considerably weaker than the trades taken when NIFTY was above both EMAs.
Practical interpretation
I would use the NIFTY 50 EMAs primarily as a market-condition / position-sizing filter, rather than automatically banning every Smallcap trade.
NIFTY > 10 & 20 EMA
→ Strong environment → normal/full position size
NIFTY below one EMA
→ Mixed environment → selective / reduced position size
NIFTY below both EMAs
→ Weak environment → significantly reduce risk and be selective with new Smallcap entries
Bottom line
NIFTY 50 10/20 EMA does a good job of identifying the quality of the Smallcap 250 trading environment.
It improves win rate, average trade, profit factor and drawdown when used as a filter — but a hard filter reduces CAGR.
If you like this study, please Like - Repost for other people to benefit and draw some profits in their trading / investing
t.me/Trading_Simplified_Deep…
As a tax payer of the India, I want to write to @nsitharamanoffc @nsitharaman Madam FM, India needs reassurance backed by facts, not blanket statements.
Saying that India’s economic fundamentals are fine and that there is no fundamental weakness while acknowledging concerns over crude oil prices, the rupee, food and fuel inflation, FDI flows, and capital moving towards the US and AI is contradictory.
If investors are exiting Indian markets because liquidity makes it easy to do so, that is not the correct story. Liquidity facilitates selling; investors’ expectations, valuations, earnings growth, and confidence influence their decisions.
As Finance Minister, your words carry significant weight. Investors, businesses, and ordinary citizens deserve a balanced explanation of the risks, the likely economic impact, and the steps being taken to address them.
Please communicate responsibly.
Acknowledge the challenges alongside the strengths, support your statements with evidence, and avoid sweeping conclusions.
Confidence is built through transparency, credibility, and accountability, not simply by saying that the fundamentals are fine.
Take steps to revive the Equity Market.
Everyone wants to buy at lower price during the dip
But why do most people lose money buying stocks that keep falling,
while smart investors build wealth buying the same dips?
What separates an opportunity from a trap?
The difference is simple:
Most people buy a falling price. Successful investors buy a recovery in early stage
A dip is not automatically an opportunity.
Sometimes it is a temporary correction in a strong stock;
other times, it is the beginning of a prolonged downtrend.
Here are the key reasons.
1. They confuse a cheaper price with a better opportunity
A stock falling 20% looks attractive because it was trading higher earlier.
But a stock down 20% can fall another 30–50%.
A lower price doesn’t mean a better investment. The trend, fundamentals and demand matter more.
2. They buy without trend confirmation
Most people try to predict the bottom. They buy because a stock has fallen enough, expecting a reversal.
Experienced investors wait for evidence, such as
The downtrend starts stabilising.
Selling pressure diminishes.
The stock forms a base.
Price breaks out with strong volume.
The trend begins to turn upward.
Don’t predict the bottom. Let the market confirm the reversal.
3. They ignore the broader market trend
Even a fundamentally strong stock can struggle when the broader market is weak.
When major indices are below key moving averages, market breadth deteriorates and selling pressure spreads, buying every dip becomes dangerous.
Protect capital in a weak market. Increase exposure when the broader trend improves.
4. They average down instead of managing risk
A stock falls 10%, so they buy more. It falls another 15%, so they buy again.
Soon, a small position becomes a large loss.
Successful traders define their risk before entering, size positions appropriately and avoid adding to losing positions simply because prices are lower.
Average your winners, not your losers.
5. They mistake a temporary bounce for a trend reversal
A stock can rally 10–15% during a larger downtrend and then resume falling.
A bounce alone does not confirm a new uptrend.
Look for sustained strength, improving price structure, supportive volume and a confirmed breakout rather than reacting to a few green candles.
6. They buy weak stocks instead of stocks showing leadership
During market corrections, many stocks fall. But when the market recovers, not all stocks participate equally.
Some stocks continue to underperform, while stronger stocks recover faster, attract demand and move towards new highs.
Focus on relative strength and emerging market leaders, not just stocks that have fallen the most.
7. They lack a systematic approach
Buying dips based on news, social media, gut feelings or the belief that a stock cannot fall further often leads to inconsistent decisions.
A systematic approach defines:
When to enter.
What confirms the trend.
How much capital to allocate.
Where to exit if the trade fails.
When to increase exposure.
A repeatable process removes much of the emotion from decisions.
Trading_Simplified retweeted
Another analysis to keep ourselves CALM:
Should you really worry about the RED days in the market?
They are simply part of equity investing and trading.
Historically, markets have had only slightly more than 50% green days. The rest are red days.
Yet, over the long term, major indices have still delivered 12–16% CAGR.
The lesson?
You don't need to avoid every red day.
You need to either:
Stay invested through the volatility
or
Follow the trend and participate when the market is moving in your favour.
Red days are normal.
Missing the big trends is the real problem.
#TradingSimplified #trading #profit #swingtrading
NIFTY 50: 25 YEARS - 5 UPMOVES -
5 CONSOLIDATIONS ~12.6% CAGR
Most of us are frustrated due to no gains in last 2 years, Look at the bigger picture.
Over the last 25 years, NIFTY 50 has experienced roughly 5 major phases of upmoves and 5 phases of consolidation.
There were periods when the index moved sharply higher, followed by years of sideways movement, corrections, and frustrating volatility.
Yet, despite all these phases, NIFTY has delivered approximately 12.6% CAGR over the 33-year period highlighted on the chart.
Imagine turning ₹1,000 into nearly ₹50,000 through the power of compounding.
The biggest lesson:
--Wealth creation doesn't happen in a straight line.
--Consolidation is part of the market cycle, not a reason to lose patience.
--Time in the market matters—but protecting capital during prolonged downturns matters too.
--Don't judge your strategy by a few weeks or months. Evaluate it across complete market cycles.
--Weekly and monthly charts help us see the bigger trend instead of reacting to every daily fluctuation.
The market rewards patience, discipline, and a systematic approach,
Stop chasing every move. Learn to identify the trend, manage risk, and let compounding do its work.
now already 2 years of consolidation done,
What next?
UPMOVE?
NIFTY 50: the real concern is the trend, not just the percentage fall
- NIFTY 50 is retesting the previous support zone around 22,300–22,400.
- If this week's decline continues to the close, it would mark the 9th consecutive weekly decline.
- The index is now sitting close to an important support area that has already produced reactions in the past.
- Repeated testing of the same support is not necessarily bullish. The more times support is tested, the greater the risk that it eventually breaks.
- A decisive weekly close below this zone would be technically more concerning than the number of consecutive down weeks itself.
Smallcap 250: the index looks much stronger than the individual stocks
The Nifty Smallcap 250 is only around 4.8% below its recent high, which looks relatively benign compared with NIFTY 50.
But looking underneath the index, many individual small-cap stocks are experiencing much deeper corrections.
That is a classic breadth deterioration situation.
Time to save your capital, not to trade against the market direction.
Should you buy any course or coach to learn trading / investing?
Before joining any trading coach, ask one simple question:
If your system can consistently multiply capital 10X, why is the primary business selling the system rather than compounding the capital?
A course can teach useful concepts but marketing a trading education program is not proof of trading performance.
The biggest trap for beginners
Novice traders often see:
“10X your capital” → “This person must know how to make 10X.”
That conclusion does not follow.
A person can potentially make more predictable income by selling education, subscriptions, communities and coaching than by taking trading risk with their own capital.
Don't buy the dream. Verify the evidence.
Before paying for any trading course, ask:
“Show me your independently verified trading performance, including CAGR, maximum drawdown, complete trade history and risk taken.”
If the answer is primarily another sales pitch, testimonials, lifestyle photographs, screenshots of winning trades or promises of transformation, stop and investigate further.
A good trader doesn't necessarily make a good teacher.
and a good teacher doesn't necessarily have a profitable trading record.
Don't judge a trading system by how convincingly it is marketed.
Judge it by evidence, risk and repeatability.
Your hard-earned capital deserves due diligence before tuition.
Currently charts clearly show an important market-condition signal:
both NIFTY 50 and NIFTY 500 Equal Weight are trading below their key aveages 10 DMA and 20 DMA.
This is exactly where market-condition filtering becomes important for a trading system.
Why this matters
When the major indices are below the 10/20 DMA:
- Market momentum is weak, short-term trend has turned negative.
- The probability of successful long trades generally becomes less favorable because individual stocks are fighting a weak broader market.
- Even good-looking stock setups can fail quickly when market breadth and momentum deteriorate.
- Breakouts are more prone to becoming false breakouts.
- Stocks that looked strong can suddenly lose momentum and hit stop losses.
- Frequent trading in such an environment can result in multiple small losses and unnecessary brokerage/ slippage.
The biggest benefit: capital preservation
A good trading system is not only about identifying when to buy. It should also tell you when NOT to trade.
When both major indices are below 10/20 DMA:
Don't force trades → Don't chase setups → Reduce exposure → Preserve capital → Wait.
The objective is not to participate in every market move.
The objective is to have capital available when the market moves back into a favourable trend.
xitter.cf/deepakdgy/status/20990…
Market Condition or Market Stance
This is very important concept for successful traders.
Use the averages that suits to your timeframe but follow them consistently
(1) Strong bullish market
20 DMA > 50 DMA + both rising (WTF)
10 DMA > 20 DMA + both rising (DTF)
Become aggressive: That means
a. More trades
b. Larger position sizes
c. More willingness to pyramid
d. Hold winners longer
e. Take more breakout/EP setups
f. Use available buying power/margin more aggressively
g. Higher RPT for risk management
h. Exposure up to 100%
(2) Range Bound Market
20/10 DMA starts flattening OR
20 DMA crosses below 50 DMA (WTF)
10 DMA crosses below 20 DMA (DTF)
Become Conservative: That means
a. Fewer new trades
b. Smaller positions
c. Less pyramiding
d. Faster profit-taking
e. More selective breakouts
f. Reduce RPT
g. Exposure will reduce 50-25%
Not necessarily go from 100% invested to 0% overnight.
The exposure was adjusted based on how the market was behaving.
(3) Weak/bear market
20 DMA < 50 DMA + declining (WTF)
10 DMA < 20 DMA + declining (DTF)
Become defensive, go on cash and capital protection
Become Protective: That means
a. Stop forcing breakouts
b. Reduce exposure
c. Take fewer trades
d. Preserve capital
e. Wait for the market to repair
f. Reduce RPT below 0.25% or stay out of market
g. Exposure will reduce below 25% to full cash
Reduce trading in a deteriorating market and protect capital
In short:
Good environment --> Push
Mixed environment --> Normal
Poor environment--> Reduce
Terrible environment--> Get out of the way
WTF- Weekly Time Frame for Positional Trades
DTF- Daily Time Frame for Swing Trades
Captain Smit Machchhar: Courage that inspires millions
Captain Smit Machchhar, an Indian pilot with Fly Dubai, displayed extraordinary courage and presence of mind when he was stabbed by his co-pilot during a flight.
Despite being seriously injured, he managed to open the cockpit door, enabling passengers and crew to overpower the attacker and helping save 174 lives.
His actions remind us that one person's courage can inspire millions. Positive emotions such as pride, gratitude, hope and admiration spread far beyond the individual who inspires them.
His bravery has brought people of different nationalities together in appreciation of a remarkable act of humanity.
For Indians across the world, his bravery is a reminder that our actions, integrity and courage can earn respect far beyond national boundaries.
One act of courage, countless lives touched, and a powerful reminder that positivity, too, is contagious.
We all wish him a soonest recovery.
btw, he live in our society.
I received several queries on SMALLCAP250 about comparison of daily vs weekly EMA which was perceived to be better than daily.
I rerun the analysis and compared Daily Vs Weekly performance parameters and also with market conditions w.r.t. NIFTY50 trend with 10/20EMA
It is interesting findings:
Spare 6 min to understand it.
Daily vs Weekly Comparison:
Same Smallcap 250. Very different results.
Tested the 21 EMA trend-following strategy on Nifty Smallcap 250:
📊 Daily 21 EMA + 3% SL
- 217 trades
- 45.8% win rate
- 31.93% CAGR
- 5.97 Profit Factor
- -13.53% Max DD
📊 Weekly 21 EMA + 5% SL
- Only 47 trades
- 40.4% win rate
- 17.81% CAGR
- 5.88 Profit Factor
- -29.64% Max DD
The interesting part D Vs W:
217 → 47 trades
3.14% → 10.43% average trade
8.28% → 31.10% average winner
Weekly trading captured fewer but much larger moves, with holding periods extending to 602 days.
But there are some negatives:
Lower trade frequency + bigger winners came with a significant CAGR reduction and higher historical drawdown.
So the choice isn't simply about maximising CAGR.
Daily = more signals, higher historical CAGR
Weekly = fewer trades, bigger trends, simpler execution
The right timeframe depends on what you value: Choice is yours based on returns, frequency, time, stress and trend participation.
Like and Retweet this for larger participation and benefits to others.
NIFTY50 conditions
What happens when main index is strong or weak in terms of 10/20EMA?
I tested whether the NIFTY 50 market condition, using its 10 EMA and 20 EMA, can improve the quality of entries generated by the Smallcap250 Daily 21 EMA + 3% SL strategy.
What the study tells us
1. NIFTY EMA condition improves entry quality.
When NIFTY is above both 10 & 20 EMA:
- Win rate improves: 47.2% → 49.2%
- Average trade improves: 2.98% → 3.72%
- Profit factor improves: 5.83 → 7.57
- Maximum drawdown improves: -8.84% → -7.53%
So the Smallcap 250 signals are generally higher quality when the broader NIFTY 50 trend is healthy.
2. But the hard filter reduces CAGR.
Trades fall from 178 → 122, and
CAGR falls from: 29.81% → 24.86%
This happens because the filter removes some trades that would eventually become profitable.
Most important observation
When NIFTY 50 was below both 10 EMA and 20 EMA, the Smallcap entries that occurred during those conditions had:
- 39.4% win rate
- +0.79% average trade
- 1.96 profit factor
That is considerably weaker than the trades taken when NIFTY was above both EMAs.
Practical interpretation
I would use the NIFTY 50 EMAs primarily as a market-condition / position-sizing filter, rather than automatically banning every Smallcap trade.
NIFTY > 10 & 20 EMA
→ Strong environment → normal/full position size
NIFTY below one EMA
→ Mixed environment → selective / reduced position size
NIFTY below both EMAs
→ Weak environment → significantly reduce risk and be selective with new Smallcap entries
Bottom line
NIFTY 50 10/20 EMA does a good job of identifying the quality of the Smallcap 250 trading environment.
It improves win rate, average trade, profit factor and drawdown when used as a filter — but a hard filter reduces CAGR.
If you like this study, please Like - Repost for other people to benefit and draw some profits in their trading / investing
t.me/Trading_Simplified_Deep…
$MRNA
How did it rise 255%? Luck?
Not exactly.
Sudden move was unexpected, that part was chance.
But being positioned for the move was the result of a process.
Positional Reversal Trade | Weekly Chart
• Stock had fallen 86%
• Long consolidation/base formation
• Green candles + high volume on the right side of the base
• Red candles + low volume
• Cup & Handle / VCP structure developed
Entry:
• 1st entry when price crossed the 20/50 DMA
• Partial profit booked at ₹77 — ~38% gain
• Price retraced to the 50 DMA and moved higher
Pyramid:
• 1st pyramid added at ₹57
• Then the stock exploded to ₹175 in a single day
• Now around ₹199 — ~255% above the initial entry
Partial profits booked along the move.
The move couldn't be predicted.
The setup could be identified.
That's the difference between luck and process.
You don't need every trade to become a multibagger.
A few exceptional trend moves can make a significant difference to the overall portfolio.
Trade the setup.
Manage the risk.
Let the winners surprise you.
Positional Reversal Strategy
Highlighting the importance of following 1-2 strategy
The key is to follow 1–2 proven strategies with discipline and consistency. Focus on proper risk management, position sizing, and always use a stop loss (SL).
My current portfolio top 10 stocks from India and the top 7 stocks from US.
Avoid copying others or acting on random views, news, or opinions. Instead, learn 1–2 strategies thoroughly and work towards mastering them.
For more details, refer to my Positional Reversal Strategy infographic. Remember, even an average strategy can deliver good results if you follow it consistently over time.
You can also check the stock performance shared in the link below. These results were achieved even though the Indian market has been choppy over the last 3–4 months.
Keep realistic expectations. In trading, not every trade will be successful. You can assume that around 30–40% of trades may hit the 10% stop loss and get exited.
Successful trading is not about winning every trade—it's about managing risk and staying consistent.
t.me/Trading_Simplified_Deep…
Another analysis to keep ourselves CALM:
Should you really worry about the RED days in the market?
They are simply part of equity investing and trading.
Historically, markets have had only slightly more than 50% green days. The rest are red days.
Yet, over the long term, major indices have still delivered 12–16% CAGR.
The lesson?
You don't need to avoid every red day.
You need to either:
Stay invested through the volatility
or
Follow the trend and participate when the market is moving in your favour.
Red days are normal.
Missing the big trends is the real problem.
#TradingSimplified #trading #profit #swingtrading
I analysed 7 major Indian indices over long historical periods.
The result is fascinating:
📊 Nifty 50: 53.3% up days | 46.6% down | CAGR 12.14%
📊 Nifty Bank: 52.7% up | 47.3% down | CAGR 16.29%
📊 Smallcap 250: 58.8% up | 41.1% down | CAGR 14.50%
📊 Midcap 150: 58.1% up | 41.9% down | CAGR 15.71%
The other indices showed a similar pattern.
Even markets that compounded wealth strongly had a huge number of down days.
So the objective shouldn't be:
-- Avoid every losing day
-- Predict every market move
-- Be right all the time
Instead:
✅ Participate in major trends
✅ Control losses when conditions deteriorate
✅ Reduce exposure in weak markets
✅ Let winners run
You don't make money by avoiding every red day, but manage them.
You make money by capturing the big trends while surviving the bad ones.
Trading_Simplified retweeted
These two posts mentioned below cover most important parts of trading:
What to buy and how much to buy based on risk.
Once these are understood, the remaining challenge is to repeat a simple, proven strategy or setup consistently.
Repeat this with discipline for 2–3 years, learn from every trade, and the probability of becoming consistently profitable can improve significantly.
Trading is not about finding 100 strategies.
It is about finding one that works—and repeating it with discipline.
How much to buy at what risk?
Read the post
xitter.cf/deepakdgy/status/21009…
What to Buy?
Read the post
xitter.cf/deepakdgy/status/21005…
A high-quality positional setup built around
Price + Volume + Market + Sector Leadership.
Call it a 7 STAR rating,
it can be applied on any timeframe,
1️Prior strong uptrend
2️Volume expansion during the uptrend
3️Tight VCP / Cup & Handle consolidation
4️Higher volume on green candles than red candles
5️Market in uptrend — CNX500 > 20 DMA > 50 DMA
6️High volume on the trigger candle
7️Sector outperforming the index
The process is simple:
Strong trend + healthy consolidation + demand/volume + strong market + leading sector = a setup worth watching.
Quality over quantity. Process over prediction.
#TradingSimplified #PositionalTrading #StockMarketNews #trading #7star
Market Condition Matters.
Many traders focus only on stock selection and entry signals while ignoring the overall market environment.
That can be a costly mistake.
Know the market stance / condition.
Adjust your aggression accordingly.
Following these conditions, capture larger trends and get out in bear trends
🟢 Strong trend → Push
More trades • Larger positions • Pyramid • Hold winners • Higher RPT • Up to 100% exposure
🟡 Mixed/Range → Normal
Be selective • Smaller positions • Lower RPT • Reduce exposure gradually
🔴 Weak/Bear → Protect
Fewer trades • No forced breakouts • Preserve capital • RPT <0.25% or stay out
Good → Push | Mixed → Normal | Poor → Reduce | Terrible → Get out of the way
Trade with the market—not against it.
xitter.cf/deepakdgy/status/20990…
Market Condition or Market Stance
This is very important concept for successful traders.
Use the averages that suits to your timeframe but follow them consistently
(1) Strong bullish market
20 DMA > 50 DMA + both rising (WTF)
10 DMA > 20 DMA + both rising (DTF)
Become aggressive: That means
a. More trades
b. Larger position sizes
c. More willingness to pyramid
d. Hold winners longer
e. Take more breakout/EP setups
f. Use available buying power/margin more aggressively
g. Higher RPT for risk management
h. Exposure up to 100%
(2) Range Bound Market
20/10 DMA starts flattening OR
20 DMA crosses below 50 DMA (WTF)
10 DMA crosses below 20 DMA (DTF)
Become Conservative: That means
a. Fewer new trades
b. Smaller positions
c. Less pyramiding
d. Faster profit-taking
e. More selective breakouts
f. Reduce RPT
g. Exposure will reduce 50-25%
Not necessarily go from 100% invested to 0% overnight.
The exposure was adjusted based on how the market was behaving.
(3) Weak/bear market
20 DMA < 50 DMA + declining (WTF)
10 DMA < 20 DMA + declining (DTF)
Become defensive, go on cash and capital protection
Become Protective: That means
a. Stop forcing breakouts
b. Reduce exposure
c. Take fewer trades
d. Preserve capital
e. Wait for the market to repair
f. Reduce RPT below 0.25% or stay out of market
g. Exposure will reduce below 25% to full cash
Reduce trading in a deteriorating market and protect capital
In short:
Good environment --> Push
Mixed environment --> Normal
Poor environment--> Reduce
Terrible environment--> Get out of the way
WTF- Weekly Time Frame for Positional Trades
DTF- Daily Time Frame for Swing Trades
Trend Following Strategy on Indian Indices
I tested a simple 21 EMA trend-following strategy across 5 Indian indices over last 20+ years: this can give potential returns for future but not guaranteed.
1. Nifty Pharma
2. Nifty FMCG
3. Nifty Auto
4. Nifty Smallcap 250
5. Nifty Midcap 150
One can make a index portfolio out of this and avoid looking at market on daily basis.
Tested on various options of 2%, 3%, 4%, 5% and NO stop-loss to get the optimal SL.
The surprising part?
3% SL emerged as the practical sweet spot.
neither very tight, nor wide open.
Why?
• 2% was too tight → excessive premature exits
• 3% reduced stop-outs while retaining most of the CAGR
• 4–5% gave little additional benefit and generally higher drawdowns
• No-SL did not provide a compelling return advantage
With 21 EMA (weekly) + 3% SL:
-- Smallcap 250 CAGR: 31.93%
-- Midcap 150 CAGR: 28.20%
-- Auto: 18.22%
-- Pharma: 14.32%
-- FMCG: 10.34%
And the key insight:
The 21 EMA is the trend-management tool.
The stop-loss is the risk-control tool.
Don't use a stop so tight that normal market volatility forces you out of a major trend.
Protect capital.
Reduce premature exits.
Stay with the trend.
If you like this post, retweet to benefit others.
Such study takes lot of time for checking on various options and cases.
xitter.cf/deepakdgy/status/21013…
A simple trend-following system work on
Nifty SmallCap 250 (21 years period)
8 EMA crosses above 21 EMA → BUY
Daily Close below 21 EMA → EXIT
I backtested a simple rule for period from Apr 2005 to Sep 2026, Results:
For Daily 8/21 EMA:
• 92 trades
• 55.4% win rate
• Profit Factor: 6.44
• CAGR: 22.66%
• Max Drawdown: -11.65%
• Invested only ~42% of the time
• Cash ~58% of the time
Weekly 8/21 EMA:
• 23 trades
• 43.5% win rate
• CAGR: ~15.3%
• Max DD: ~28%
start to end period CAGR is 14.5%.
The interesting part,
Cash management matters.
If the capital outside SmallCap 250 earns a 7% annual return (liquid fund) instead of sitting idle:
CAGR rises from ~22.7% → ~27.6%.
The bigger lesson isn't the EMA.
It is:
Index + simple trend-following + disciplined exit + productive cash management + compounding.
You don't need to predict every move.
You need a process that knows when to participate and when to step aside.
Backtested historical results; not a guarantee of future performance.





































