TERMS & TERMINOLOGY

PCD
Positive Classical Di vergence. Thi s shap es u s al way s i n
a down trend whi ch suggests that there i s going to b e
a temporary hal t i n the und erly ing trend . Classi cal
divergence does not al ways l ead to a t rend reversal.

NCD
Negative Classical Di vergence. Thi s shap es u s alway s in
an up trend which suggests that there i s going to b e a
temporary halt i n the underl yi ng trend . Classical
divergence does not al ways l ead to a t rend reversal.

PHD
Positive Hi dden Di vergence. This set u p wi ll be f ound in
risi ng up trends and when w e s pot a P HD i t i s a set u p
which suggests that the underly i ng trend w ill continue
further up.

NHD
Negative Hidden Divergence. This set u p wi ll be f ound in
fal li ng down trends and when we s pot a NHD it is a
setup whi ch suggests that t he u nd erly ing trend w ill
continue further down.
AIM
Stochasti cs wi th a 4 peri od %K is termed as A im. In
most softwares you have to use p aramet er 4 for %K
and rest you should j ust us e 1 . If stochastics is
unavai l able on your softwa re, then use a 4-p eri od
Wi ll iams %R. Pl ease note that the scal e of Wi ll %R is
opposi te to that of Stochastics.

SHOOT
Stochasti cs wi th a 4 peri od %K, smoot hened by a 3
peri od sma which gives us slow %K and then ag ai n
smoothened by 2 peri od sma which gives u s %D i s
termed as Shoot. In most sof twares y ou hav e t o use
parameter 4 for %K, 3 for S low %K and 2 for %D . If
stochasti cs is unavail able on your s of tware, then use
the stochastic momentum ind ex .

LEAN
Lean is the difference betw een t he numerical v alu es o f
%K and %D i n the Shoot indi cator. This LE A N is a
precursor to Shoot and gi ves an ag gressi ve t rad er an
edge to enter i nto a trade bef ore conf irmation from
Shoot. This approach can also l ead to early entries
which yiel d unfrui tful .
AO
Awesome Osci llator measur es the difference b et w een
two movi ng averages and f or our s et u ps we use t he 13
and 34 exponential movi ng averages . A O is a su bstitu te
to the use of tripe exponen ti al moving averages of 13-
21-34. AO > 0 i mpl ies the trend i s UP and vi ce v ersa.
AO rising i rrespective of being pos iti ve or neg ative
impl ies that the underlyi ng moment u m is ri s i ng and vice
versa.

RSI
Rel ati ve Strength Index, i s a u niq u e momentu m
indicator developed by Welles Wi ld er Jr. in 1 9 78 .
Divergence between pri ce and thi s RS I i nd i cator is th e
most important aspect i n al l our t rad ing set u ps.

ATR
Average True Range i s a vol atil i ty or a range indi cator.
We use thi s indi cator al ong w ith Bolli ng er Band s to g e t
an understandi ng whether t he market i s i n a s tate of
range expansion or contracti on.
BB
Bolli nger Bands i s a popul ar v ol at il ity i nd i cator which
uses the concept of Standard D ev i ation. We u se t his
indicator al ong wi th ATR to g et an und erstand ing
whether the market i s i n a state of range expans i on or
contracti on.

TF
Trade Frame is the mai n time frame or chart w hich th e
trader uses to spot a setup .

TF+1
One trade frame hi gher to y our main chart . For exam ple
if you are trading the dai l y charts, then one ti me frame
hi gher or TF+1 wi ll be the weekly chart.

TF-1
One trade frame l ower to your mai n chart . For examp le
if you are trading the dai l y charts, then one ti me frame
lower or TF-1 will be the 75min or hourly chart.
SPIKE
Spike i s a high momentum s w ing trad i ng strat eg y . We
do not wai t for confi rmation f rom L E A N or S hoot to
enter trades from this setup . Howev er a S PIKE w ith a
LEAN i s always a better and hig h-probabil ity set u p.

HIDE & SEEK

Hide & Seek i s a hi gh moment u m s w ing trad i ng
strategy. We do not wait fo r conf i rmation from L E A N o r
Shoot to enter trades from this set u p. Howev er a Hide
& Seek wi th a LEAN i s alway s a bet ter and hig h-
probabi lity setup.

AIM & SHOOT

Aim & Shoot is a l ow moment u m s w ing trad i ng strat e gy .
We wai t for confi rmati on from Shoot to ent er trad es
from thi s setup.
DOUBLE DECKER
Double Decker is a l ow moment u m s w ing trad ing
strategy. We wai t for confirmat i on from Shoot to ent er
trades from this setup.

GOOGLY
Googl y i s a low momentum swing trad ing strat eg y . We
may not wai t for confi rmation from Shoot to ent er
trades from this setup. The Googly bar can be used as a
point of entry and stop l oss .

2IN1
2in1 is a low momentum swing trad ing strat eg y . We
wait for confi rmati on from Shoot to ent er trad es from
this setup.

BACK2BACK
Back2Back is a momentum- neu tral t rad i ng strat eg y fo r
which we only compare clos ing price with a 3 -p eriod
RSI i ndicator.
OFFSIDE
Offsi de is also a momentum-neu tral t rad i ng strat eg y
which i s purel y vi sual in natu re. A compl ex combinat ion
of classi cal di vergence and hi d den di vergence leads to
this setup.

HOOK
Hook i s a contrarian trading strat eg y which su gges ts a
trade in the opposi te directi on of the u nd erly ing tren d.
The probabi li ty of a move is very hig h b u t we cannot
judge the size of the move, and so it is su gges ted to
book or protect profits from a hook t rad e as soon as
possi ble.

ZOC
Zone of Comfort i s pri ce channel which we can draw in
case of swi ng trading strateg i es u sing points of hi d den
divergence. As long as pri c es are within thi s zone t he
trade is safe and can yi el d t o higher ret u rns. A move
outside thi s channel however is a sign t hat the trad e is
moving against the expectation.
POA
Point of Action is the price p oi nt wherein you earn 1 :1
on your trade. This i s the point wherei n s ome act ion i s
needed to book or protect profi ts. A fter meet i ng i ts
PoA, a trade should not end u p in l oses .
THE BETTER YOU
PREPARE,
THE LUCKIER YOU
GET

TRADE
WELL.
TRADE
WISE