Identifying Set Ups - Price Action + MACD + EMA

Toggling between numerous stocks can be tiresome. Using a strategic method to identify potential set ups can save your time and deliver amazing results!

In the above chart,
I first noticed that the price was around its support. It can be confirmed by seeing the previous price swings that the support is well tested.
Next I look at the MACD to confirm if the divergence between the Signal Line and MACD line is decreasing to make sure if it is the right time to enter or not.

Usually these 2 steps take hardly a few seconds and I can form a preliminary idea about the position.

Once these two points are confirmed,
I move forward to confirm if the EMA 9,21 (which can been seen has worked out beautifully for this stock in the short time frames like 7-10 days) is actually looking bullish to enter right now. If the EMA is not already crossed, or about to cross, I can drop the share here. In this case, the EMA lines are very close and the chances of a bullish cross are good enough.

Next, I confirm my hunch by looking at the Volume data and see if the increase is price will actually be sustained by smart money flow , or fall down by retail trading pressures. Increasing volume with price increase helps to get conviction for a long position.

Finally, I check the RSI levels and I monitor them very closely to see if there is any Bullish or Hiden divergence and see how strong they might be. I also like to draw a vertical line at the key level from which RSI always bounces or retracts. Personally I prefer RSI levels between 50 and 60, after a recovery from 30-40. It just implies that the bulls are gaining control again and still leaves out plenty of room for entering a trade and making profits before it hits the overbought region.

After I am satisfied with the Technicals, the last thing remains is to check if there are any major news, events or rumours about the share and the recent EPS growth of the share. This doesnt affect a lot in the short run, but doing due diligence never hurts. It is how I identified IEX , HUL and TCS just right before they shot up.

Thanks for reading!
Keep Learning :)


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Good clear chart and idea with good clear explanation.
200 coins
+1 Reply
@AngusMcK, Thank You! :)
Amazing chart!
+5 Reply
Aayush_Rungta forextidings
@forextidings, Thanks for the Amazing response! :p
Price action is simple chart analysis using stock movement behaviour complimented with Volume. You channel drawn is exceptional but why add indicators to chart? This defeat purpose of Price Action study itself.
You can be either Price Action trader or indicator based trader. Use of EMA & Volume is more than sufficent for confirmation. I am sure if you remove indicators, it will be simple & better study.
Good work on channel.
+2 Reply
Aayush_Rungta Piyush-Gupta
@Piyush-Gupta, Will certainly keep that in mind, Sir! The indicators were just for strengthening the conviction that bearish momentum had almost bottomed out.
Great Analysis
+2 Reply
Aayush_Rungta Karthikmk
@Karthikmk, Glad :)
Sir, which time frame should follow for intraday and delivery
Aayush_Rungta sarvanamma
@sarvanamma, I dont do Intraday, but I have heard 15 min and sometimes 5 min time frame are effective. Usually I place my swing positions on 1 day or 4 hour charts