While we are trading within the range, there generally is a directional impulse, just that it is short lived. That very fact makes the market oscillating. So, to adapt to this first modification is to reduce the time horizon of the trades.
The market is a mix of ‘Trending’ which means in one direction (up or down) and oscillating moves which mean back and forth.
While the nitty-gritties of trending moves are more talked about with respect to its direction and intensity, oscillation on the other hand just gets a reaction of “It is time to take a walk in the park”.
Out of personal experience though, I beg to differ as it was oscillation back in 2009 which made me fall in love with Options all over again. There were few ground rules that we learned from trades.
Well, we do not get an email from the exchange, so the only notification of oscillation is when either side (Long/Short) trades of most of us are getting lost.
While in absolute terms the index or the stocks may not be putting big gains or losses on the charts, there certainly is a short-lived volatility.
Thus, while in oscillation unlike the secular directional move, it is advisable to have constant level driven modifications in trades with respect to the direction and the longevity of trades.
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