Nice Trap: A Trade Commentary

Trading @ 254.70 when the sock came to my notice. Took some intraday support from 253-253.70 and had been consolidating for some time in 254.10 to 254.80. I looked at the daily chart , it was positive uptrend. I looked at the tape. There was huge seller @ 255 which the buyers were absorbing as the stock completed consolidation on 5min. chart. I wanted to take the trade above 254.80 with a stop of 254.10 in mind and target near day's high @ 258.

I got in as the stock broke the consolidation range. It was an aggressive BO trade. But immediately after the stock hit 255.45 past consolidation range, it reverted back to the consolidation area in the next 5 min candle. I was paying a psychological price of not waiting for confirmation.

Stock made a low of 254.15 and took a breath. Bids moved as high as 254.80 before the 255 sellers came back. The number of shares and no. of orders were increasing from 2000s to 3000s at 255 level. But the stock managed to pullback to 254.95 now as I have been writing this commentary live with one eye on the tape :) I know that if it fails this time to move past 255 it ll break 254.

Earlier I missed TataMotors trade which I wanted to sell below 425. I did not place the limit order b'coz I wanted to sell on pullback as there were more buyers in the stock than seller before breakdown and wanted to reassess the situation. But it never pulled back before it hit near 422.

Anyways, NBCC is failing to cross 255 and is coming down. I reduced position @ 254.70. The stock is trading at 254.10 stop level. I did not use hard stop and also there were big buyers at 254 so I waited and decided to get out below 254 only. Stoploss hit.

So was it a wrong trade in a stock which is in uptrend ; Opened with a gap with huge volumes ? Not at all b'coz sometimes the overall market sentiment pulls down an out performer. Its part of game. I may reconsider buying it lately.

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Trade safe, be healthy.


Comment: Winning trades induce pride, the losing ones Kindle diligent learning :)


intraday trade are time consuming more,also expence,
Bravetotrade rupambose32
@rupambose32, They r fast at the same time.
Good Strategy
@Janta41, Hi, I generally refer following BO confirmation strategies to take trades.

no_follow_up thing, but agian you werent waiting for it,you got in hot :D
also, the aggressive BOS_confirmation thing can be thought as "safe" if one stays in the trade just for the BO candle? thus avoiding any no_follow_up situation.
blue line at 254.80 to close of candle 255.40, =0.50 points , thats not a lot but yea, high volume can make up for it.
just my two cents :D
Bravetotrade Einstein15
@Einstein15, it happens :D Sometimes it's good to get lessons from trades by booking small losses.
A similar setup in Bharti would have made money.
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