Today I log here a beautiful case study of Axis Bank scrip. Look at the opening candle that's a beautiful hammer near the day's central pivot 'p'. Please refer the 5-minute chart below.
The price started moving up. And I expected some form of Resistance near present weekly pivot 'P' which also happens to fall near mild intensity Resistance zone marked in Red box at 697 levels.
Instead, Price moved above 200-MA and penetrated weekly pivot and took support at both daily pivot 'r1' and 'P' zoomed higher and higher for the rest of the day.
Please take a look at RSI. The indicator aptly gave good bullish signals at 11:00 in the morning and again at 1:20 in the afternoon. The 11:00 o’clock signal had good Risk-Rewards ratio.
The 11:00 A.M. trade set up had more confirmations. To list a few, price morphed 697 resistance zone into supply zone. RSI signal was present. Price was above 200-MA. Price took support of daily pivot ‘r1’ and weekly pivot ‘P’. Healthy Risk-Rewards ratio is also present.
Consequently, price reached next Resistance zone near 708 neatly.
How about Nifty 50 index for the day?
Frankly I was expecting further downside in broader index. In fact, there was overlapping downside pivot relationship. To my surprise, Nifty opened gap up with Hammer kind of candle. The interesting part in the chart is the convergence of weekly pivot 'P' and daily pivot 'r1' near 14750 levels. Nifty opened near this zone and took support of the zone and moved higher and higher all through the day. Please see the 10-minute chart Nifty 50 below.
Nifty hit the next convergence of weekly and daily pivots near 14910 levels. In the process Nifty 50 filled the Gap marked by circle. For trial and error purpose I conceived a trade plan with 1:2 Risk-Rewards ratio which accomplished the target. My Stop was below the opening hammer candle.