Technical Trading with Rectangles

Today we would see the Line Study method using Rectangles for trading in Indian Markets.

Rectangle refers to a chart pattern where a security’s price is trading within support and resistance levels that are flat and parallel to each other, which looks like a rectangle and hence its name. A breakout of the rectangle on either side with strong volume accompanying is considered to signal a strong trend in that direction.

This means that, the Trading is in a Range, usually referred as Trader's Remorse. See the figure below

The Bottom line is a Support Level Line and the Top line is a Resistance Level Line. Trader's should remain in cash during these ranges. However, during the breakout, you can notice that the Volume substantial increase, then you can see a Breakout on the upper side, if the volume is very less or even non existent, you can assume that the Breakout would be a bearish one.

Depending on the Volume Support and the Range Support, you can profitably take positions during Day Trading using this method.

Note that this should not be used as a standalone trading method.

Thank you for joining us in this discussion.

We will join you with the Market Outlook tomorrow.

Happy Evening & Good Night!
Day Trading Analyst

Post Market Outlook

Today Markets encountered a heavy selling pressure, due to Chinese Market closing 5 % negative. We thought European Markets would help us to recover during the second half of the trading session, this was not lucrative enough.

Nifty closed at 4387 by losing 192 points. Whereas, the Indian Benchmark Index Sensex, closed at 14784 points, after losing a heartbreaking 626 points; by the end of today's trading session.

We were not able to post anything during the last week, due to some technical difficulties. We would be posting all posts from today.

Thank you for your co-operation and joining us in this discussion.

Happy Evening!
Day Trading Analyst!

Market Outlook & Trading Calls

As this week is the third Week of the month, US Market's are at F&O Expiry week. Hence, we might see some negative moves there, due to some profit booking.

Asian Markets have started the day in Red; this means that Indian Markets can also start the day in Red, as US Markets recovered in the later part of the day, we can also expect Indian Markets to recover in the later part of the day.

Oil and Gas Sector is looking very attractive today.

Today's Trading calls are

ONGC – Buy above 1225 with target of 1245 SL at 1198; Sell below 1194 with target of 1175 SL at 1205.

GSPL – Buy above 76 with target of 79 SL at 73; Sell below 72 with target of 70 SL 73

That's all for the Trading Calls

Thank you joining us in this discussion

Happy Trading!
Day Trading Analyst