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Trend Analysis

How to trade like the Institutions/Banks? - Selling narrativeWith this post, we'll try to understand the selling narrative of the institutions and how they trap the traders on both sides. Just remember this one thing, "the market is never moved by retailers, only institutions can do that". The only reason why the institutions sell is to buy at lower prices. Nothing more than that. This happens in the following way: 1. Institutions initiate selling near a support level so as to create a narrative of a "Bearish trend". 2. When the narrative is set, the retailers think in the following ways: •Longs fear for their stops below the support line •Others wait to initiate shorts at the close below the support. 3. When the price closes below the support level, two types of orders are placed instantly. Stop losses of longs and fresh sell orders of the shorts with buy stops above the support line. 4. Longs get stopped out. These retailers are selling to institutions which acts as a discount for them. 5. Breakout shorters start shorting but their stops get taken out in the next few candles when the institutions move the price back up in the intended direction. 6. In this way, the majority of the retail longs and shorts are taken out of the market. After the initial rally, the price returns to the demand block for the following 2 reasons: 1. To fill the pending buy orders from institutions 2. To close the shorts which the institutions initially opened so as to push the price downwards. This is also called mitigation. After the longs get filled and the mitigation is over, the price moves back up in the original direction. This process repeats like the clockwork. You can go and back test on any time frame. The only thing that requires skill is the identification of these phases in the live market, which obviously takes a lot of practice. The more you practice, the better you will become. If you don’t believe in these concepts and are trading profitably using the indicators, then just ignore this post. This post is meant only for those who want to get an insight as to how the institutions work. All these concepts are real and work very much, you are free to read from Google. Also, if anyone is interested in getting a PDF version of this thread, then you can check the links under this post. I spend a lot of time creating these educational posts, illustrations, charts, and PDFs. Please be appreciative of that and leave a like and comment if you found these helpful. It will help to know that people are reading these posts. Disclaimer: This is NOT investment advice. This post is meant for learning purposes only. Invest your capital at your own risk. Happy learning. Cheers! Rajat Kumar Singh (@johntradingwick)
NSE:ICICIBANKEducation
by johntradingwick
62
Agarwal IndAgarwal Industrial C is involved in the business activities of Manufacture of other petroleum (includes manufacture of petroleum jelly, micro-crystalline petroleum wax, slack wax, ozokerite, lignite wax, petroleum coke, petroleum bitumen and other residues of petroleum oils or of oils obtained from bituminous minerals). Company’s Total Operating Revenue is Rs. 833.29 Cr. and Equity Capital is Rs. 10.26 Cr. for the Year ended 31/03/2021. Agarwal Industrial Corporation Ltd. is a Public Limited Listed company incorporated on 13/01/1995 and has its registered office in the State of Maharashtra, India.
NSE:AGARINDEducation
by HITTESHKOTHARI
Bearish market structure - Illustrations + Structure typesThis is the third post on market structure. Do check out the previous 2 posts if you haven't already. Recap Market structure is simple and a basic form of understanding, how the markets move. The Price Action is how the market moves based just on price, without the consideration of trends and how they may continue. But the market structure is focused mainly on the trend. The market structure is formed using swing highs and swing lows. You may have already heard about the formation of higher highs and higher lows in a bullish trend or the formation of lower highs and lower lows in a bearish trend. This is what is called as market structure. What is a Bearish market structure? A bearish market structure is a structure that constitutes of formation of a series of lower highs and lower lows. In simple words, when the price is making lower lows and lower highs, it is said to be forming a bearish market structure. Illustration: Bearish market structure What is the use of identifying a Bearish market structure? Identifying any market structure plays a crucial role in entry and exit. In the case of a bearish market structure, the previous lows are often seen as resistance zones where new shorts can be entered with an expectation of lower price movement. When the price returns to or near the previous low, it is often seen as a selling opportunity, commonly known as “selling the rip”. Exhibit: Pullback in a Bearish market structure If a stock is moving in a bearish trend but the price prints a new higher high, the trader must become cautious because a trend change may be underway or it may just consolidate before resuming the original trend or it may very well be a bull trap. If a trend change is confirmed, the trader may exit the shorts and look for the trades on the long side. So, after the formation of a new high, there are only 3 scenarios that can arise. 1. Trend reversal 2. Consolidation and continuation 3. Bull trap Exhibit 1: Creation of a new high Chart example: Exhibit 2: Trend reversal Chart example: Exhibit 3: Consolidation and Continuation Exhibit 4: Bull Trap These are the only structure that can form in a bearish trend and they will occur time and again. Hence, all these concepts are valid on all time frames. This is all you need to know about a bearish market structure. Now, open any random chart and back test the concepts. The more you practice, the better you will become. Whatever strategy you use, understanding the structure will always make you more confident in your trades. I spend a lot of time creating these educational posts, illustrations, charts, and PDFs. Please be appreciative of that and leave a like and comment if you found these helpful. It will help to know that people are reading these posts. Disclaimer: This is NOT investment advice. This post is meant for learning purposes only. Invest your capital at your own risk. Happy learning. Cheers! Rajat Kumar Singh (@johntradingwick)
NSE:NIFTYEducation
by johntradingwick
11
Bullish market structure - Illustrations + ChartsRecap Market structure is simple and a basic form of understanding, how the markets move. The Price Action is how the market moves based just on price, without the consideration of trends and how they may continue. But the market structure is focused mainly on the trend. The market structure is formed using swing highs and swing lows. You may have already heard about the formation of higher highs and higher lows in a bullish trend or the formation of lower highs and lower lows in a bearish trend. This is what is called as market structure. What is a Bullish market structure? Like I said above, a bullish market structure is a structure that constitutes of formation of a series of higher highs and higher lows. In simple words, when the price is making new highs and higher lows, it is said to be forming a bullish market structure. Exhibit: Bullish market structure What is the use of identifying a Bullish market structure? Identifying any market structure plays a crucial role in entry and exit. In the case of a bullish market structure, the previous highs are often seen as support zones where an entry can be made with an expectation of higher price movement. When the price returns to or near the previous high, it is often seen as a buying opportunity, commonly known as buying the dip”. Exhibit: Pullback in a bullish market structure Similarly, as soon as the price breaks the previous low and creates a new low, the trader must become cautious because a trend change may be underway or it may just consolidate before resuming the original trend or it may very well be a bear trap. If a trend change is confirmed, the trader may exit longs and look for the trades on the short sides. So, after the formation of a new low, there are only 3 scenarios that can arise. 1. Trend reversal 2. Consolidation and continuation 3. Bear trap Exhibit 1: Creation of a new low Exhibit 2: Trend reversal Exhibit 3: Consolidation and Continuation Exhibit 4: Bear Trap These are the only structure that can form in a bullish trend and they will occur time and again. Hence, all these concepts are valid on all time frames. This is all you need to know about a bullish market structure. Now, open any random chart and back test the concepts. The more you practice, the better you will become. Whatever strategy you use, understanding the structure will always make you more confident in your trades. I spend a lot of time creating these educational posts, illustrations, charts, and PDFs. Please be appreciative of that and leave a like and comment if you found these helpful. It will help me to know that people are reading these posts. Also, if anyone is interested in getting a PDF version of this thread, then you can check the links under this post. Disclaimer: This is NOT investment advice. This post is meant for learning purposes only. Invest your capital at your own risk. Happy learning. Cheers! Rajat Kumar Singh (@johntradingwick)
Editors' picks
NSE:NIFTYEducation
by johntradingwick
70
Introduction to market structre Market structure is one of the most undervalued topics in trading. People don't spend enough time learning about it. In this thread, I'll try to touch on all the important aspects of market structure. Introduction Market structure is simple and a basic form of understanding, how the markets move. The Price Action is how the market moves based just on price, without the consideration of trends and how they may continue. But the market structure is focused mainly on the trend. The market structure is formed using swing highs and swing lows. You may have already heard about the formation of higher highs and higher lows in a bullish trend or the formation of lower highs and lower lows in a bearish trend. This is what is called as market structure. How to draw and find market structure? Finding a market structure is an easy task. All you have to do is connect the recent swing highs and swing lows and identify how the price is moving. If the price is forming a series of higher highs and higher lows, then it is a Bullish market structure. Similarly, if the price is forming lower highs and lower lows, it is a bearish market structure. I’ll post separate threads on various market structures at a later point in time. Types of market trend The market trend in 3 different directions at any given time and understanding when a shift occurs based on the timeframe you watch is pivotal to successful trading. The 3 types of market trends are: 1. Bull trend 2. Bear trend 3. Sideways trend Type of market structure There are 5 types of market structures. 1. Bullish market structure 2. Bearish market structure 3. Ranging/sideways market structure 4. Change of trend from bullish to bearish 5. Change of trend from bearish to bullish Exhibit 1: Bullish market structure Exhibit 2: Bearish market structure Exhibit 3: Ranging/sideways market structure Don’t worry I’ll cover all these topics in separate threads. This was just an introductory thread on market structure. Read the post a few times and you will be able to understand everything. If anyone is interested in getting a PDF version of this thread, then you can check the links under this post. Disclaimer: This is NOT investment advice. This post is meant for learning purposes only. Invest your capital at your own risk. Rajat Kumar Singh (@johntradingwick) NSE Certified Technical & Fundamental Analyst Happy learning. Cheers!
BITSTAMP:BTCUSDEducation
by johntradingwick
21
A Tutorial on Support and Resistance - Part 1.A Tutorial on Support and Resistance - Part 1. What are Support and Resistance ? Support - Is the price level from where people expect maximum buying/demand to come. 1. Price is falling and it is expected to reverse and move up from Support. 2. Support level is always below current price level. 3. Is used to create buying positions or book profits in shorts. Resistance - Is the price level from where people expect maximum selling/supply to come. 1. Price is rising and it is expected to reverse and move down from resistance. 2. Resistance level is always above current price level. 3. Is used to book profits in long positions or create shorts. Other parts to be followed - Part 2 - Why Support and Resistances are formed ? or Why they work ? Part 3 - How to find/draw Support and Resistance ? part 4 - How to trade using Support and Resistance ?
NSE:EDELWEISSEducation
by NaveenGr
GNA AXELS : Wave counts + Time cycleIn this post i have tried analyzing chart by combining both price/volumes and time factor simultaneously. For deciding trend and predicting price i have used Elliot wave theory and for timing and entry/exit i have used cycle theory. Elliot wave theory Impulse wave rule: 1)Wave 2 can't retrace wave 1 entirely 2)Wave 3 can't be shortest of wave 1,3 and 5 3)Wave 4 can't enter wave 1 price action zone. Time rules of Neo wave (Extention of Elliot wave) 1)Wave 2 takes equal or more time then wave 1 took to form 2)Wave 4 takes equal or more time then wave 3 took to form Wave labeling is done by following this rules. Wave Count Primary : Wave 4(Green) Intermediate : Wave A(White) Minor : Wave C(Orange) not shown. Analysis: As far as wave count's are concerned, since covid low's we are seeing impulsive rise in which we have completed wave 3 on Primary degree(green) and currently we are in Primary wave 4,Intermediate wave A, and going ahead prices will continue to correct or stay side-ways until Primary wave 4 is done,as wave 3 was extremely extended possibility of Primary wave 4 being an running flat is low meaning any forth coming bounce will not give us new high. Time wise :As per Neo wave rule 1) Primary wave 4 can continue till December 2022 hence entering at current levels is not advisable. Price wise :Support areas for Primary wave 4 to end. 1)We have 50 % retracement of Primary wave 3 coming at 641 along with minor wave 4 low's at 655 along with 200 ema average @ 620 which would keep increasing,there by making price action support zone of 640-660. 2)61.8% retracement of Primary wave 3 @ 530 and previous All Time High coming at 555 level(Confluence for price support) along with running intermediate trendline(white) making price action support Zone of 530-555. 3)Theoratically Primary wave 4 end's near Intermediate wave 4 of extended Primary wave 3 which is coming at 360 levels,we also have 80% retracement of Primary wave 3 coming at 360 level(Confluence for price support). JM Hurst Cycle theory: It states that stock prices follows definite cycle and achieve significant lows or trough's at the end(beginning) of each cycle.During any cycle price makes meaning low's around every cycle period time zone.Post a cycle low zone, prices reverses or trend changes,and if the low's made during cycle period time zone get's broken in the next cycle then during that entire cycle prices tend to correct.After his years of observation JM Hurst has found Nominal Cycle model which describes standard cycle's found in the markets he researched.One of the cycle he mentioned in Nominal model is of 20 weeks(which is being followed over here).There are many principles of cycle theory which i am not describing over here as it would complicate things. Time Cycle: 22 week Since beginning GNA AXLES seems to be following 22 weeks cycle meaning after every 22 weeks meaning full low is formed,post which we have seen prices going up and it this low is broken in the next cycle then during that entire cycle prices has corrected.Over here i have somewhere i have taken 23 weeks and somewhere 24 weeks just to capture exact low's however it can be seen that most of the time prices has formed low on 22nd week indicating stock is following 22 week cycle.As of now we are nearing cycle low time zone(week ending on 6th December)meaning after first or second week of December we can see minor bounce in the prices as per time cycle. Combining Volumes: Volumes were rising during this entire rise from covid low's during every impuslive wave high formation ie from Intermediate 1 of Primary 3 till Minor 3 of Intermediate 5 of Primary 3,and we can clearly see volume divergence on minor 5 high as it was achieved on an significantly low volume compare to minor 3 high. Conclusion: Price and time are not in favour of bulls hence investor or trader should keep stop-loss on there existing long positions depending upon there risk appetite and fresh long's should be avoided until Primary wave 4 is done.Any bounce from current price should be used to exit long positions. Disclaimer:The analysis done in this post is just for education purpose and to introduce concept of time cycle,no position should be build or exited solely on it's basis.
NSE:GNAEducation
by UNDERDOG-29
1
Do not buy5 waves upmove of EWT completed in Neuland and then it gave bearish Head and shoulder breakdown. After breakdown it created a gap. Price cam to fill the gap and started trading down. Parallel channel is also visible in recent consolidation. Price may do zig-zag within the band giving false bullish EMA crossover to onboard the new investors which missed the opportunity in bull run. They will be slaughtered in next correction which might take price to the final target of H&S and near to the bottom of 4. Any investment buying from institutions or big whales will emerge only below ₹1000. Till that time avoid the stock even if it touched 2000 level. Disc : it's not an investment advice to buy or sell
NSE:NEULANDLABEducation
by TukkaNomist
U-TURN Resistance converts into Support (EDUCATIONAL -AARTIIND) Aarti Ind. ltd. This stock has taken Resistance twice at same level, then it consolidated as a parallel channel at that same zone, and then it given good breakout from parallel channel along with good intensity of volume, Now it has retraced almost 78.6%, co-incidentally (1) same resistance zone, (2) Parallel channel's top, (3) Support trend line and (4) 200 DEMA, all are there at similar point location, All these 5 conditions met at same level that can provide good support. This scenario makes probabilities very strong each time. where stop loss is too low and Reward is too Good. Overall scenario Perfectly U-turn from valid fibonaccy level 0.786% Daily macd line uptick and also converging towards positive Good support zone Support providing 100DEMA also at same responding zone Parallel channel scenario Support Trend line Disclaimer I am not sebi registered analyst My studies are for educational purpose only Consult your financial advisor before trading or investing I am not responsible for your profits and losses
NSE:AARTIINDEducation
by RK_Chaarts
16