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Different Methods to Identify Perfect Entries with ConfluenceBasics of Trading and the areas of interest of every trader to have minimum knowledge to understand the market and its movement. Volume Based Entries Basics of Volume When the price is trending volume will be above volume moving average that will be considered as trend, when volume is too high in a session thats higher than 3x to volume moving average that will be considered as climax which means maximum orders are filled in the exsisting trend. Apart from stocks if such Climax pattern in volume in any format is seen then consider there might be a reversal soon. If one is trading in the stocks you get to see this ultra high volumes in gap ups and gap downs, now you will have to know what sort of gap it is to take entries which we will discuss in the Gaps later. -------------------------------------------------------------------------------- Gaps Gaps theory needs to be understood properly, over 4 kinds of Gaps are found in charts. Simple understanding follows : Common Gaps : Normal gaps that happen every day with in a ranging market Break Away Gaps : If a range/pattern/Support or Resistance is broken with a gap that is called break away gap. This sort of gap happens in the early stages of trend. Running Gaps : After breakaway gaps rest of the gaps if happened towards the trend is called running gaps. as long as there is an exhaustion gap. Exhaustion Gaps : This Exhaustion Gap happens either up or down after an up trend or the same in a down trend. These gaps gets filled giving an idea that the trend has ended. Consolidation Areas Consolidation areas or the trading ranges are to be considered as Support & Resistance areas to identify for patterns like Triangle, wedge, flag, pennant, or rectangle patterns. good areas to look for gap up or down and volume to identify breakout for the next move or plan for the next session. Fib Extension & Retracements Fibonacci extention and retracements is the basic knowledge that any trader who is willing to learn about technical analysis should be considering learning in depth, its a basic tool that gives you a lot of info, Basic knowledge to know is Fibbonacci Retracement is used to identify the entry and Extension is used to identify the exit. levels of interest are called the golden ratio i;e: 38%, 50%, 62% this is where majority of the reversals happen, these can be considered as Support & Resistance zones to look for breakout entries Support & Resistance Every traders nightmare is to understand or identify S&R in the initial days of your trading is not because you cannot ... it is because you are too curious, anxious, exited to enter into a trade, once you calm down and try to understand the market its not that hard to identify them ... S&R areas are the reversal zones or breakout zones it is going to be a big topic if tried to explain the whole concept so lets just stick to basics and use pivot high and low and FIB levels as your support and resistance zones for now. Trendline Breakout These are first thing that any trader learns try to master them, a perfect trendline is considered a strong support in uptrend or resistance in downtrend when it has respected this line for least 2 times from its start point. A breakout gives you and opportunity to enter in to a trade. Elliott Wave This is not considered as entry point in the initial stages of learning but one should know the basics of elliott wave to identify the trend we are in by looking at the leg we are in and you can calculate the trend by given wave length through fibonacci ratios. Only thing that you need to know is that market doesnt move in a straight line like you see in elliott wave picture above there will be waves with in waves. Try to bring all these together as confluence to understand the market move and take entries. Note : Train the eye to identify the structure, then comes the logic and explanation.
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NSE:YESBANKEducation
by TeamTaurus
14
Axis Bank - Will it break or not?Axis bank is continuously moving in a channel. Now it made a bowl pattern at its resistance level from where it can give a 2-3% rise if breaks. Another point is that we can see a good fall if it faced rejection. It can later go up to the lower level of the parallel channel . As of today, it closed with good volume if the market opened in a good range then we can see good buying in AXIS BANK, which lead us to the target of 830 from our current position and the second target of 850 (where it previously faced resistance) If the stock faced resistance then we can see consolidation for some time and that consolidation will decide its upward and downward direction for the downward direction we are having the support of 785 and the second support at 750. . . Disclaimer: These are not any recommendations for any funds or stocks and are meant only for educational purposes.
NSE:AXISBANK
by SUTHARTRADE
Postmortem on #BankNifty - 10 OCT 2022SPX fell 2.8% & NDQ 3.88% on friday and the handout to us today morning was not that positive. As expected bank nifty opened gap down 38461 below the support level of 38698. The first candle was bearish, closed down & may have indicated that the rest of the day will be negative. But what happened in the next 2 candles were the opposite, a hammer the 2nd candle and a bullish marubozu 3rd. The 3rd candle took out the now resistance indicating the day will not be negative but will trade above the 38698 level. And what happened from 10.10 to 12.50 was magic, for a moment i thought bank nifty is really on drugs. How does it find the strength to rally 700+ points on a negative macro day. Notice the price action between 12.30 to 13.00 below, it was right at the resistance level of 39326. BN did not break this resistance and then reversed course to a nice fall till 14.10. From 14.15 to close, BN regained some strength and closed quite strong according to me. Due to the rally today, the IVs were dropping and i could not really enter into any trade. I was expecting the option premiums to double and the IVs to skyrocket - but that did not happen. The traded volume on options were higher, but the premiums were lower indicating a range bound expiry so far this week. However these dynamics can change if the support or resistance is broken - you know how easy it is for bank nifty to send the options premium to the sky. Rs10 to Rs160 will not take even an hour. 5mts TF - does not show bearishness yet. The current pattern shows consolidation with a bullish bias 1hr TF also does not show the bearishness yet - price consolidation at current levels is what i infer Bank nifty important support and resistance liness1:38698, s2: 37946r1: 39326, r2: 39739 Thanks for reading Viswaram Finance! Subscribe for free to receive new posts and support my work.
NSE:BANKNIFTY
by viswaram
Postmortem on #BankNifty - 06 OCT 2022 - Weekly Expiry Bank nifty opened 39343 right at the resistance line made a long wick 5mts 1st candle. The 2nd candle broke the SR line. At 09.40 after seeing the red candle i assumed BN will trade lower and exited the 39500 iron fly at the cost price. I was not expecting BN to go up and the 4 candles from 09.45 to 10.00 really surprised me. And all the trade that happened till 12.55 was against the trades i had in my mind. The reason i thought BN would not go up was because of the long wick and the immediate break in SR during the first 15 to 20mts. The trades from 13.00 to close was something that really comforted me. Eventhough i did not make big money trading today’s expiry - the closing price action was inline with the opening pattern. Again all these trades would be positional as it was the weekly expiry, to know if the trend is continuing or not we need to watch the trades of tomorrow & monday. For traders who would have taken an intraday straddle or strangle - there is a high possibility that their stop loss would have been hit. If for some reason they forgot to put the SL or simply didnt have one - they would have made money as the opening & close was almost the same. 5mts TF shows no specific direction. If tomorrow also BN stays in this range - then i would prefer to plan for a range bound expiry for 13th. 15mts TF shows a W bottom pattern 1hr TF shows the W pattern with much more clarity. This need not be taken so seriously as BN just came out from a double top M pattern last week. So we would need to wait for further sessions to confirm if its trend continuation or reversal. Bank nifty important support and resistance lines s1:38698, s2: 37946 r1: 39326, r2: 39739 Thanks for reading Viswaram Finance! No recommendations, No predictions !
NSE:BANKNIFTY
by viswaram
Postmortem on #BankNifty - 28 SEP 2022 Banknifty opened gap down at 38081 and in the first 5mts candle itself it took out the support line of 37946. There was an immediate bounce somehow giving us the impression that the support was intact, the minor pullback tried to close the gap but lost steam by 10.15. The fall from 10.20 to 10.45 looked interesting because the support level proved quite important now, already in the day it held its shape twice. The trades from 11.10 to 13.20 although lacked strength looked very shallow. #ICICIBank had moved to the positive territory in this window and was providing great support. None of the other banks like #HDFCBk & #SBIN were in positive territory. The move from 13.30 to the close of day was having great conviction towards the negative side. I was also quite surprised to see the big red candle in #AXISbank at 14.05 (which was accompanied by heavy volumes). The last 15 to 20mts saw heavy short positions been taken at the call side. The farthest OTM of 46500 CE was traded more than 1 crore - this might be a new record, at least i have not seen this much volume in the strike that is 9000 points away from ATM 5mts TF - showing bearishness. Banknifty is continuing to break supports with no or nil rally to the nearest resistance lines. 1hr TF also showing bearishness. For any fightback BN has to take out the 38697 resistance immediately. Bank nifty important support and resistance lines s1:37247, s2: 36559 r1: 37946, r2: 38698 more ideas at viswaram.substack.com no predictions, no trade recommendations !
NSE:BANKNIFTY
by viswaram