Budget Day Trading Strategy -Stocks List , Entry Timing, Exit, Stop loss

 

Budget Day Trading Strategy

Budget day in the stock market can be highly volatile, presenting traders with unique opportunities and challenges. This strategy outlines a two-phase trading plan focusing on key timings, specific stocks, and market psychology.

Phase One: Pre-Market Preparation and Initial Entries

Homework and Market Context: Before budget day, examine if the market has been moving sideways for five to eight days.

• If the market has moved upward, prepare to take short positions.

• If the market has moved downward, prepare to take long positions.

Rule #1: No Trades Before 10:00 AM

• Avoid entering any trades before 10:00 AM to observe initial market reactions.

Key Stocks for Watchlist:

• SBI

• LIC

• Tata Power

• Nifty

• Bank Nifty

• UPL

• Chambal Fertilizer

• Exide

• Amar Raja

Timing Strategy:

• At 10:40 AM, make a short entry if Nifty shows significant bearish movement (200-350 points).

• Prepare to act within two minutes of a 6% to 8% drop, as further declines are possible.

Stock-Specific Phase One Actions

ITC:

• If ITC is at its day high or middle range:

  • Sell at 10:45 AM with a 2% stop loss.

  • Hold until a 6% to 8% drop, then prepare to buy.

  • Hold the buy position for up to 45 minutes or until it recovers from -6% to -1% and moves to +1%.

Page Industries:

• Short at 12:45 PM near the day high.

• Cover the position if there is a 2% to 4% drop.

Tata Power:

• Short as soon as power-related announcements are made.

• Target a 6% to 8% decline.

Exide:

• Short at 12:45 PM and hold for a 3% to 5% move.

Chambal Fertilizer and UPL:

• Short at 12:45 PM only if they are near the day low.

• Avoid shorting if a significant fall has already occurred.

• Optionally, short these stocks at 10:40 AM if they are consistent losers.

Phase Two: Post-Market Reaction and Closing Moves

SBI:

• Monitor SBI closely between 9:00 AM and 12:00 PM.

• If SBI drops 2% to 3% within 9 to 12 minutes, create a short position within the next 3 to 5 minutes.

• If a 3% to 5% fall occurs, cover the short and take a long position.

• SBI’s movement will significantly impact Bank Nifty, so a recovery in Bank Nifty may follow.

LIC Housing:

• Short if it falls 2% within 9 to 12 minutes.

• Wait for a 3% to 5% fall, then cover the short and take a long position in Nifty.

Game of the Index

• If Nifty falls 100 to 150 points within 5 to 8 minutes, create a short position within 2 minutes.

• Expect a further 200 to 350 point drop within the next 10 to 15 minutes.

• Exit immediately after this second fall.

• For upward moves of 100 to 150 points, avoid buying immediately. Wait for the second move before making a sell decision.

Timing Consideration for Phase Two:

• Between 2:30 PM and 2:45 PM, monitor Nifty’s momentum:

  • If moving continuously up, prepare to take a reverse position.

Summary of Key Timings

Time	Action
10:40 AM	Short Nifty on significant movement
10:45 AM	Short ITC at day high or middle
12:45 PM	Short Page Industries, Tata Power, Exide
12:45 PM	Short Chambal Fertilizer and UPL if near low
2:30 PM	Monitor Nifty for phase two reversal

Additional Considerations

• Avoid impulsive trades based on breaking news.

• Maintain strict stop losses and target levels.

• Monitor minute-by-minute charts for better precision.