I present my mid-day thoughts on today's trade. Though Axis Bank scrip opened Gap up beyond the previous day high, there was heavy selling in the beginning of the day. Here is a 2-minute chart of Axis Bank.
I drew two trend lines and prematurely assumed that it was a Diagonal pattern. I expected a rise to 700 levels. Hammer shown by the arrow mark was the cue to me. I reasoned out: "Buyers are coming." RSI too was looking bullish.
'Place the stop below the low of Hammer and go long' was my primary thought. But, I completely ignored the Bearish candle next to Hammer. We can see small green candles which indicate buyers were weak. Somehow, I didn't notice this.
My Long entry trade details are as follows. Entry Price @ 694.8, Target @ 700.8, and SL @ 692.8. My stop got erased as the price started moving down. Professionals caught the novices nicely here.
At 11:15, there was another opportunity to go long in Axis scrip. Having suffered first loss for the day I couldn’t muster much courage to go long. We can see in the hindsight that the second opportunity was a good one.
What about Nifty 50?
The broader index continuing its ascent reached 14850 levels by 1:00 p.m. Nifty opened Gap up with a strong Bullish Candle for the day taking off 14695 Resistance zone. All through the day Nifty kept inching higher and higher. Please refer the 15-minute chart of Nifty 50 index below.
Lessons:
I must put in place list confirmations that need to be satisfied before a trade is taken up.
More active focus is must to see if the presumption of the trade is being challenged in the real market environment. If yes, make zero hesitation to take action.