When creating the long position, entering at the lowest levels has a better possibility of giving returns. While on the upper side booking the profit at the highest point is the right trading strategy. However, finding the right entry and exit point is not possible for everyone, especially if you don’t have an idea about trading and technical analysis. So, the question arises here how to find or determine the entry and exit points in the stocks.
Breakouts & Breakdowns
Breakouts occur at the resistance levels, where most of the time stock price or market index stops or turnaround from a bullish to a bearish trend. However, when bulls are dominating such resistance breaks and when the stock price comes out from this trajectory it is called the breakout point where you can decide to enter into a trade position.
Support & Resistances
Similarly, there are resistance levels from where the stock price turns back where you can enter into a short position or book the profit of a long position. Make sure the price does not break this resistance level otherwise, there will be a bullish trend and you should create a long trade position from here and wait till the uptrend continues.
Use the Open Interest Data
If you are looking for entry and exit positions in the future and options market, then you can use the open interest data for trading decisions. The coordination of change in open interest with change in price shows a bullish and bearish trend in the stock or market index.
You can analyse the open interest data to decide whether to enter or exit from the individual stocks or market index. An increase in the open interest with an increase in price shows there is the possibility to move the stock in an upward direction, hence you can enter with a long trade position and similarly, there are other signals with change in open interest.
Low and High Swings
Swing trading can also be used to decide the entry and exit positions in the stock market. In TradingView when the market trades in a range there are high and low points providing the swing trading opportunity for the traders. You can use these swing points for deciding the stop-loss while entering into the new trade position.
However, swings can also be used for making trading decisions but it is possible when you analyse the swings with the right chart patterns. You can also use the various technical indicators that help to know the right levels of buying or selling where you can enter into the trade positions. These indicators will also help you to know the entry and exit points with a better level of accuracy.
Entry and Exit Indicator in TradingView
You can follow the above-discussed tools and techniques along with technical indicators to find the entry and exit points. And to get best experience while applying and analysing with technical indicators is TradingView.
5 Best Entry Indicators in TradingView:
1.Moving Averages
Moving averages (MA) are one of the most common and widely used indicator used by beginners and professionals. MA can be used to identify support, resistance, or buying levels in stocks and indices. There are two types of moving averages that are generally used by participants in the stock market, i.e.
- Simple Moving Average (SMA)
- Exponential Moving Average (EMA)
You can use the crossover between these moving averages for entering into a trade. When the 50-day SMA crosses the 200-day SMA, it is a bullish entry signal with a possible uptrend in the market or stock. Here you can enter with a long trade position.
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Relative Strength Index (RSI)
RSI is another momentum-based oscillator that measures the speed and change of price movement. RSI indicator oscillates between range of 0 – 100. When the value falls below 30, it indicates that the price has entered into an oversold condition. An oversold condition is one that the stock has fallen sharply and is expected to bounce back.
When the indicator line crosses above 70, it indicates that the stock is trading in an overbought zone. It indicates that there are growing chances of pullback and an investor should book some profit or enter into a short-selling position.
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Bollinger Bands
Bollinger Bands (BB) follows the price movement of stock and uses the standard deviation to tell the volatility of the stock. There are three bands showing the support and resistance with the range of volatility of the stock. When the Bollinger Bands start to movie away from each other, it signifies volatility in underlying security during that period.
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Moving Average Convergence Divergence (MACD)
MACD is another widely used technical indicator that you can use for making entry in the market. The indicator shows the relationship between two EMAs of a stock price. The indicator has two lines as well as histogram.
- The MACD line
- Signal line
When the MACD line crosses the signal line to the downside, it is seen as a bearish signal. On the contrary, when the MACD line crosses above the signal line, it indicates upward momentum it is a bullish signal. You can enter into the trade, when the MACD line crosses above the signal line and it would be better if this crossover is accompanied by the positive histogram value.
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Supertrend Indicator
SuperTrend is another indicator in the TradingView that traders use to identify the entry points in the stock or market. The main advantages of SuperTrend are as per the market volatility, it can adjust the dynamic support .
