Get started

Candlestick Analysis

NIFTY OBSERVATION 2:- nifty had resistance (R1) at 1935 to 11015 which was formed by Gap created at Feb panic and resistance (R2) at 11137-11170 which was "all-time resistance". we have seen a indecision ( spinning top ) in nifty which was a strong bearish sentiment catalyst but for supporting nifty, we have two small fresh gaps which act as support. we can see old big gap vs new small gaps following days which declares winners bulls(all-time new highs) OR bears (2018 lower lows)
NSE:NIFTYEducation
by harshahacks
The Play after a Spike and RangeNormally we see that after a spike or impulsive move the price gyrates in a trading range. This is the zone where most of traders lose money coz there is no clear direction to play. We can observe this situation in all time frames. In order to play ranges we have to be patient and wait for price to break down the range. See 'A' in the left figure, this is the point where large funds or those who have some sort of information about news or something are buying..let's just ignore who is buying and remember that price bumps out of range. Why dun we buy at A? Coz we dun know as of now that the price is going to reverse back into the range or up. So when do we buy? We buy as price pops back into the range sharply. Here comes our sweet spot 'B' to buy..for confirmation i would look for a bullish candle shown above (u can use your favorite bull candle). Either just buy above the high of bull candle or into the small pullback that follows the bull candle. Stops here should be below the low of bump 'A'. In case we miss the above play and the price jumps above the range we can look out for small pullbacks that follow. Normally a two legged pullback piercing into the range or touching the ceiling of the range is preferred, in this case I would buy at D. However if price makes a single leg pullback and I find myself in a situation where I can only buy at high (coz trend is very bullish) then I would wait for price to make new high at 'C'. The latter is the least preferred trade as it is much riskier. In these two cases the SL will be below the low of small pullback. For entries I would also look for a bullish candle formation. Yes, it is good to wait till close of the candle and buy above the high of this candle. In all the three cases we have been trying to minimize our risk. We want our SL to be as closer to our buy price as possible but we also dun wanna stuck in a failure move, thats why we use bullish candle confirmation. Sometimes our bearish bias stops us from buying at point A,B,C or D. Why? Bcoz of some falling trendline or some previous important peak or resistance line at those levels in some higher time frames. In these cases 1) I would simply miss the trade or 2) I would use strict stops and trail. The post is for educational purpose and can be applied to any market. I always suggest to minimize risk and never take risk more than 1-2% of your capital. Play safe Stay healthy. Like, comment, share and follow. Thanks
NSE:BANKNIFTYEducation
by Bravetotrade
18
Mahi Mahi: If A Stock Is Down 2%, It Can Be Down by 4 %That's true..down 2% doesn't mean it can not go down further. But the conditions are that: It should be in a strong downtrend on a higher time frame; and we should have proper tools and system to manage our trade. M&M has been in a strong downtrend on Daily, 4H and H. So I thought it could be nice short. But by the time I could open my lappy, stock was already down 2%..how lame. I opened up my Ichimoku System and saw that stock had given a fresh break down below the cloud with higher volumes on 15 min chart (See candle A) and it was already in bearish territory on higher time frames. All I need to do was to find a better opportunity to enter. Candle B went deep into the cloud and then sold off quickly. I placed a sell order below the small swing @ 1319.50 and got hit in the very next candle C. My initial stop was above the high of candle B. Then I kept on trailing. The doji pointed in the chart had a nice volume but price was able to breach only a few paisas above this doji, and I was not stopped. # I always give some room above the high of the candles when I trail so that I am not hit easily. Finally I was thrown out of the trade @ 1303.60. It was a nice 16 point trade or 1% of the stock value. Whenever I get 1% of the stock value as profit I call it a good trade. Without a good system in hand, I might not have touched the stock. Above trade does not mean that I dun lose. I had a small loss in SRT buy, which I covered later in the session by shorting it. Sometimes it takes time for daily trend to clarify itself. I was breakeven in Tataglobal and you all know about Mindtree :) The above experience would definitely help me to be more disciplined in future. I hope the same for all traders. Have Fun, and happy weekend. Hit like and comment. Regards Bravetotrade
NSE:M_MEducation
by Bravetotrade
8
Educational 17: Rising Three Method- Bullish Candlestick PatternRising Three Method - Bullish Continuation Pattern A bullish continuation candlestick pattern that is used to predict the continuation of the current uptrend. This pattern is formed when the candlesticks meet the following characteristics: 1. The first candle in the pattern is a long White/Green candlestick within a defined uptrend. 2. A series of descending small-bodied candlesticks that trade within the range of the first candlestick. Three inside bodies also counted as consolidation period before continuation of the uptrend. 3. A long White/Green candlestick creates a new high, which indicates that buyers are back in control of the direction and the trend shall resume and go further up. I encourage you to find a chart with this pattern and share your experience to bring confidence and clarity to other traders on this pattern. I appreciate your support, Regards
BSE:DIVISLABEducation
by NeeteshJain
9