Page 1 - MEX Express - Vol 5 Issue 4

Mercantile Exchange Nepal Limited
Invest - Trade - Earn
An ISO 9001:2008 Certified Exchange
KYC: Corn
Page 2
From the CEO’s Desk
As we bid farewell to the year 2013, and
likewise usher in the New Year with renewed
vigor and enthusiasm, I would like to turn
the pages back and enlighten the ardent
readers of this edition of the MEX Express
on the major events of the institution in the trading has some fundamental strategies whose synergy affect may
year gone by. This reminiscence may not be as useful as a brick
from the Berlin Wall but just like that plain old brick’s value as a
memorabilia; 2013 will certainly be etched in the pages of history
as the year in which MEX Nepal managed to retain the charm of its
glorious preceding years amidst the various challenges and obstacles
that the market environment threw before us.
The major challenge of the year was the migration to a new core
online business solution i.e. a new online trading platform for the
existing clients. This task seemed tedious given the magnitude of
the assignment in front of us, but due to the perpetual co-operation
from all the stakeholders involved, I am glad to say the migration
was smooth for all the parties involved. The need of a new platform
was driven by the investors themselves and I am glad to say that the
traders have embraced the new console with open arms.
MEX Nepal had added another feather in its long list of
accomplishments by becoming the first commodity exchange to be
nominated amongst the top 5 for the FNCCI Award for National
Excellence, i.e. the apex award, and the FNCCI Award for Services
Excellence, in the medium category in the FNCCI National
Excellence Awards-2070. This enormous feat is the concentrated
effort of all the stakeholders involved and will certainly place the
commodity market in general on the roadmap for enhanced interest
amongst the contemporary investors.
A void was felt in the limited banking options that the corresponding
investors had within the trading environment. Keeping this view
in mind, MEX Nepal undertook an understanding with Nepal
Investment Bank Limited, thereby bringing to the forefront the
third banking partner affiliated with us. With this understanding,
investors have increased their options in selecting the bank of their
choice while trading within the system.
As I conclude this message, I am looking at the sun beaming through
our windows throwing a sense of hope and belief in the ensuing
year ahead. 2014 - is certainly a year of endless opportunities, let’s
embrace it!
- Jitesh Surendran
CEO, MEX Nepal
MEX EXPRESS www.facebook.com/mexhome
MEX EXPRESS
A Smart Solution for Online Trading
www.mexnepal.com
Volume: 5 • Issue: 4 • Year: 2013 A.D
MEX News Portal Market Perspective
Page 3 Page 4
Small Techniques make a BIG difference!!!
When VIBGYOR, the perfect combination of sequential
colors pass through prism, the white light can be seen but when
VIBGYOR passes through any ordinary glass then no effect can
be seen although small amount of energy is lost. This example is
truly fitted to daily trading in the commodity futures. Commodity
increase chances of a winning trade. There are seven small but
winning techniques that can lead to profitable trade.
(1) Recognizing Trend Direction, (2) Confirming Entry Point
(3) Mapping Trade flow
(4) Safeguarding Trade (5) Finding exit point (6) Calculation
of P/L and Margin (7) Refresh for reentry
(1) Recognizing Trend Direction: It is foremost part of commodity trading to know the trending direction. This will determine to go for
a BUY or a SELL. If the trend is an upward direction then the trader should go for a BUY in any downward-ditch and if the direction
of trend is downward then the trader should go for a SELL with opportunity of any upward-crest. To know the trend, a lot of
technical indicators can be used like CCI, Average Directional Movement Index, Moving average etc. Brief knowledge of any trend
line indicator is required. It must be noted that while recognizing the Trend, one should keep on watching macro-economic events
that cause market movements because reversal of trend can be seen at any point of time due to strong or weak economic event.
(2) Confirming Entry Point: Once the Trend is identified then the next step is to confirm the price at which the trade can be initiated
and should be marked properly without any confusion. It’s not always psychologically easy to find the entry point of trade but it’s
not tough to get too. Various methods can be used to uphold for Trade Entry Point like Candlestick Patterns, Volume, and Fibonacci
etc but at the same time, Bounces, Break out, Continuation or Reversal pattern can help the traders to locate the Entry Point during
analysis.
(3) Mapping Trade flow: After entry into a trade, the trader should map the trade continuation that how long they can stick with time
of profit & time of loss. Simply, a trader should have exact preplanned trading flow strategies to avoid any dilemma and Mapping of
trade flow should be pre-information based and practical. It can be traced by copious technical tools like Price Movement, Support
& Resistance, Day range identification etc. In an easy way, its surveillance time for trading till calculated price reaches. It should
be noticeable that before mapping the trade-flow, one should have idea about next coming economic news which can pull or pushes
the price of security with unexpected jump so economic calendar must be watched timely before making this plan.
(4) Safeguarding Trade: This is an imperative step in the process of trading to protect the trade with the help of features availability
and suitability e.g. Take Profit, Stop Loss, Buy Limit or Sell Limit. Trader should try to maximize profit when they are in winning
situation but it is state of mind of novice trader that when they are in small profit, they used to close position and try to be out of
the trading session and while they are in loss then they used to keep on waiting for reversal. This is nothing but only a trade fear in
the mindset and it should be avoided as much as possible.
(5) Finding exit point: This is last step to trading methodology which lets the trader find the exit point of running trade. Trader is
exclusively decision maker here when to close position regardless of winning trade or losing trade. Trade exit point can be decided
with study of Support & Resistance level, Candlesticks patterns, Pivot Points, Day High & Low level etc. It should be set before
starting the trade and must be more than total commission paid and spread loss but if luck favors strongly then let the profit run till
next decided exit point as per the situation. Let’s try to take maximum possible tick to add in the profit sum.
(6) Calculation of P/L and Margin: This is the step to know the strength of a successful or a failure trade during a trading session.
Profit or deficit in account is calculated and accordingly needs to be adjusted margin amount. If equity is surplus then margin/risk
ratio can be increased in the next coming trades and if it is in deficit then the ratio needs to be minimized.
(7) Refresh for Reentry: Trader should give space after each trading session because market conditions can be changed at any moment
as it is unpredictable most of the time that’s why a trader should always have a fresh look towards every trade regardless of the
excitement of winning and depression of loosing.
Although commodity futures trading is somewhat situational than educational in many times that’s why Mr. Jay Gould, a Speculator
whose success made him the ninth richest American in history told that “No man can control Wall Street. Wall Street is like the
ocean. No man can govern it. It is too vast. Wall Street is full of eddies and currents. The thing to do is to watch them, to exercise
a little common sense, and … to come out on top.”
Lakshman Pandit
Manager
Business Development
Department
MEX Nepal
www.twitter.com/mexnepal Page 01