Subsequent price action in the last two weeks has played out the above scenario. The highest point price Bharti has touched is 866 and the lowest 786. The last five days have seen vary narrow price movements filled with dojis ( meaning the opening and closing prices are almost the same) and inside days.
This shows indecision. And as I mentioned in my post yesterday, "One of the guiding principles (of trading) is when things are not clear - stand aside until the market reveals its hands."
This brings us to a question - what will be the indications that the market has decisively moved as far as Bharti is concerned?
A study of the chart shows that support and resistance of the recent price actions are 870 and 750. Therefore it opens the following trading opportunities.
1. Wait for breakout above 870: Go long if bharti closes above 875-900 for two consecutive days with SL at 750 and target 1000 - 1050.
2. Wait for breakdown below 750: Go short if Bharti closed below 750 for two consecutive days with SL above 850 and targets of 710, 660 and 620.
3. Trade between 750 and 850: In other words, sell at 850 with 875 as SL and 780 as target OR buy at 780 with 750 as SL and 850 as target.
The options 1 and 2 are more conservative than option number 3.
If you have any comments please write to me at stockmarket.methods.in.madness@gmail.com
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Disclaimer: The above analysis is just that - my analysis. If you choose to trade on the basis of this analysis, you will be solely responsible for the outcome of the trade - profit or loss. Please keep in mind that trading and in particular day trading is not for the novice and there is significant risk of loss of capital in trading.
Yep,its fine.
ReplyDeleteCan we play NR7 in the above chart?
Vicky, I agree with you that putting NR7 would add value. I will investigate if I can superimpose NR7 in the future. Thanks for the comment
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