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Breakout

Basic Pattern: explanation of Cup and Handle pattern.How to trade Cup and Handle pattern? The Cup and the handle pattern is basically the retracement from the prior top to about 1/3rd of the vertical height of the cup. Cup and Handle pattern can be seen both as a bullish continuation or reversal pattern. Cup The Cup is usually “U” shaped and may be considered as a rounding bottom with almost equal highs on the both side. Handle The handle is usually the pullback and the pullback is about 1/3rd of the size of prior advance. The smaller the pullback, better is the strength of the formation and higher the possibility of breakout. Volume The breakout from the handle’s resistance should be appear with increased volume therefor conforming the breakout. Target The projected target from the breakout is usually the vertical distance from the high to the bottom of the cup. If you want more education ideas please LIKE, and give SUGGESTIONS in the COMMENT box below.
NSE:NIFTYEducation
by Jay_shree
44
YOUR EDGE: THE ORB STRATEGYWhat would be trading without an edge? Would it be like tossing a coin with 50% chances of getting a head or a tail. I dun think so. I think it would be around 25%, that too if you dun mess with your trades. So what is an edge? In broader sense, the edge is your trading plan which includes predefined entries and exits. In narrower sense, it is technical analysis (TA). In my opinion TA is just a part of your edge -- trading plan. Your edge would help you to define the three elements of the trade, that is, When, What and How. Which means What should I trade? When should I trade? and How should I trade? It's lame that most part of our learning concentrates on just 'How' element. Whereas most of us (even the experienced traders) find it very difficult to deal with 'What' part of the edge, that is, what should I trade today? In this article I am going to introduce to you the Opening Range Breakout (ORB) strategy. I would try to elaborate all the above three elements of the ORB edge. The ORB Plan Layout How While there are many versions of ORB, I personally prefer the first 5 min version. Let the stock trade for the first 5 min. Just Mark the high and the low. What I prefer this strategy in top Gainers (not losers). Just wait for a few minutes after the market opens and look for top gainers on NSE website (I would like you to prefer if you have filters on your own software). Choose the gainers which have been trading outside the previous day's range. When Place a buy stop order above the high of the chosen stocks and sleep until it is hit :) As soon as it is hit place a stop below the low of the first 5 min bar. Hunt for your targets: Look for 1:1 or 1:2 target depending on the stop loss. If the stop is wide then go for just 1:1 or else go for 1:2 Tips for short plays: This strategy works well on long trades rather than on the short side. As on the short side the action, most of the times, is very huge in the first 5 min bar which increases the risk on the trade. However you may apply ORB on the short side If the action is not very strong on the first bar and the stock actually develops a range for the first 30 minutes or so and then breaks it. Money management: There could be another full post on this topic but I will introduce a shortcut formula here to decide on the no. of shares you should trade in any setup. Say you have a capital of 50,000 and you want to risk 2% on one trade. So the risk comes out to be 1000. Means you can risk 1000 on one trade. Let's say the stop loss on your setup comes out to be 5. Just divide the stop by the risk and that's the no. of shares you should trade. In this case 1000/5=200 shares. So No. of shares to be traded=Risk/Stop I hope you like this post and make some money out of it. I would surely post some of the trades that I took last week with this strategy. Trade safe, Stay healthy.
NSE:NIFTYEducation
by Bravetotrade
10
Real-World example of Price ROTATION trade and accurencyKeep your stop loss Outside of a penetration area. The trade will execute after breaking up/down will give you the direction of trade. Following points should be observed before entering to trade. 1) Volume should increase from the normal range of it. 2) The volume with the price. For insta nce , if down-breakout, price fall with raising volume will favor of your trade direction. 3) Take price when price heavy surge in volume, because of most of the trader book the profit at that time. 4) Read price but not news or other talks. 5) etc. If you want to get UPDATE/ALERT when a breakout, LIKE this post.
NSE:ITCEducation
by Trade-Technique
2