The core of our method lies in drawing Horizontal lines mostly at the end of the day marking Swing highs,lows,gaps, res ,support,breakouts ,Breakout Failures etc.Even I have posted so many charts.
But I am highly surprised that none of you have ever asked anything about this Horizontal lines nor did you post any chart drawing lines.Is it lack of homework or lack of understanding?It will not take much time ,neither much headache.Just draw the lines .They make your trading dead simple.
Here is ICICI last 4 days chart.5 Days chart would have been Ideal.However some problem with TT hence can post only 4 Days chart
Its shows How to trade markets even when it is in sideways.
1.Draw a Horizontal line at major points OF LAST 3-5 days action/Patterns.
2.Then look for reaction at those points.
3.Then decide which way it gives more reward with less risk.
4.Take trade without hesitation.
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Lets analyse chart.
A. price makes double bottom.Breaks neck enter long keeping bottom of pattern+filter as S/L/SAR.
B.It is a point where the price consolidated 1-2 days back and broke down the support.( Not visible in the chart.Support broken now becomes resistance.The price plunges down here beacuse it was a previous support broken now becomes resistance.Think which is better option .To go long or short at this point?S/L-SAR just above the consolidation area.
C. Once price starts falling where is next support.Simply at previous double bottom i.e:A.Now at B think over which is better option .To go long or short at this point?Which is less risky.S/L-SAR just below bottom of pattern+filter . Once the price takes support at C and starts moving up where is next resistance.Obviously at Previous swing High i.e:At B.
D.It is a point where price started declining at Point B.Now again price starts declining.Now assuming that we are in range where is next suppot.Deffinately at Point C where it took off last time.Now lets see what happens.
HL: At this point where I marked as H/L ,it makes higher low means its looking to move up.Lets be neautral by end of the day as we dont have any concrete clue.
E
rice gaps up.Why? because there was a resistance at B and D .The same resistance has been taken out through gap.Now once price gaps up it is important that it sustains that gap.We wait for one hour and gap is sustained.F.Now I have a concrete evidence that Price want to move up as gap is sustained.I open my positions here once price breaks a previous swing high of the current day.Then Almost 22 Rs.move.
Summary: A-B-C-D is a range .
Below is best example of how do I trade sideways market.
THE MOMENT PRICE COMES TO A OR C I TAKE LONGS AS MY RISK IS HARDLY 6-7 RS.
WHAT DO I DO IF THE PRICE BREAKS A OR C DOWNSIDE?.SIMPLE I KEEP SAR JUST BELOW A AND C.IN CASE THE PRICE BREAKS A OR C AND STARTS MOVING DOWN.
WHERE DO I PLACE MY SAR IF THE PRICE BREAKS AOR C AND MY SHORT ORDER IS CAUGHT?.SIMPLE ABOVE THE NECK OF DOUBLE BOTTOM.
REVRESE THE FORMULA FOR LONG TRADES AT B AND D.
THEN LETS TALK ABOUT BREAKING RANGE AND START OF TREND. AT POINT E PRICE BREAKS RANGE UPSIDE I.E:BREAKS A-B-C-D.NOW LOOK FOR SUSTAINING OF PRICE ABOVE BREAK OF RANGE I.E:B-D AND ALSO WE CAN MAKE USE OF OSCILLATORS TO OPEN OR ADD POSITIONS FOR LONG TRADES.
IF YOU THINK I CAN EXPLAIN MORE SIMPLER THAN THIS,THEN I AM SORRY.
