1. FOR WHOM AND MY METHOD IS A LITTLE NEW OR BLURRY . I WILL SOON PUT UP AN EDUCATIONAL POST WITH DETAILS AND EXAMPLES. WE CAN HAVE A SERIES OF DISCUSSIONS THERE TOO. DO FOLLOW MY ACCOUNT TO GET NOTIFIED.
2. Do ask your questions in the comments if any.
Using one can identify probable accumulation or distribution regions by comparing the historical at Price and current at Price.
2. If the current is low, its mostly a pause before the trend resumes
3. If the current is higher or equivalent to historical levels then either the trend will resume or it may reverse. If it resumes then we have more strength in trend due to more accumulation. So a breakout/breakdown will confirm in this case
Mindtree has been rallying nicely with 1-2 nice accumulation regions in between. Recently there was a pause with up-sloping i:e higher highs and lows. It has just given breakout with nice .
1. Recent as per is less compared to previous accumulation and rally which means this was not a distribution region but a small pause. Breakout of which will continue the trend nicely.
2. Since the pause was in up-sloping price action and the buying(green) is more than the selling(red) , it makes sense to assume current region was a brief accumulation i:e buying took place. Which gives us more conviction that the up-trend will continue and risk is less.
TARGET WITH LOGIC
1-2 accumulations have happened since the uptrend started. Regions marked in violet.
So since the current is comparable to previous accumulation so it makes sense to consider the expected uptrend to be of equivalent magnitude.
That is more the accumulation, greater the strength, so the more the move.
So I used a Fib Extension from that level till now and chose a 168% as target.
But this target is above all-time-high so its a provisional target level.
Confirmatory breakout has happened but price is still there giving us space and favourable RR ratio to enter. So entry at CMP .
I was supposed to post this earlier but was unable to. There is still space to enter it now.
Since we are expecting a nice uptrend to continue with target high enough and again as it is swing trade, a conservative stop-loss will be better
Since 1950 is a nice support levels and just above the previous accumulation during 18Dec 2020- 5Mar 2021, so i would prefer the stop-loss around that level.
Keep trailing stop-loss as per you strategy. Using Moving Averages with ATR( ) as buffer is one the ways.
Since the target is above all time high. Its a provisional target level. So it doesn't make sense to exit at target rather hold on to it as much as possible and keep conservatively trailing stop-loss. Following can be used as exit signals or bearishness signals.
1. If there is pattern in 1D timeframe, stop-loss can be trailed to a nearby .(Like Candle Low)
2. If there is Divergence in 1D timeframe, better to exit at close of 1D since afterwards there can be long consolidation or reversal.
3. If the trailing stop-loss is hit, please exit
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