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Edge of Space (EOS) trade in RCom

BSE:RCOM   RELIANCE COMMUNICATIONS LTD.
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What is Eos?
EOS stand for Edge of Space. It is basically a line drawn at the previous Swing High or Swing Low. If the price breaks and closes below the previous swing low making a new lower low, we say that the market wants to go down. However, if later the price rises and cloese above the EOS line, (which might be the case with RCom ), we consider it a fake out and expect the market to reverse to hit our very small target.

Similarly, If price breaks and closes above the previous swing high making a new higher high but soon after closes below the EOS line, (drawn at the high of the previous swing high) we consider it a fake out as well.

We rake the help of RSI to confirm the EOS trade. RSI divergence adds to the probabilty of the trade working in our favour.

In the case of Rcom , if the price closes above the EOS line, we go LONG for a small target with stops just below the previous swing low.

Do tell me what you think.
Comment: Courtesy: Trade Academy
Comment: RCom is at the EOS line. If we close above 17.80, we have an EOS trade!
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