Here are the details of a case study in Axis Bank stock. Please refer to the 5-Minute chart below. The supply zone is marked in the red horizontal box.
The supply zone indicates the presence of sellers. Yesterday they could push prices down by 9 points. I observed price action closely as it entered the supply zone in both 5-minute and 2-minute charts. In the 2-minute chart (not shown here), there was a clear RSI-Price divergence present. Clear indication was there.
Though I had a plan to go short in the middle of the zone, I just couldn't muster courage to do so. I missed the chance.
I decided to at least make a case study. Waited for the pull back and stuck a trade box onto the chart. The trade details are as follows. Entry is @ 761.65, stop loss is placed @ 763.8, and the target is @ 756.5.
Target was fixed in anticipation of price fall to yesterday's mid-intensity support zone. At 12:45 when the stock was coming up, I had thoughts to wind up the trade. But, decided to stay on with the plan.
Finally, price took out the target. Points gained in this case study are 5.15. Today I strongly understand the need to stick to the plan. Aftermath 1:40 P.M. price retraced back.
What about Nifty 50 index?
Nifty opened Gap up with a strong Bullish candle. Please refer the 5-minute chart of Nifty 50 index.
From 9:25 - 10:30, Nifty moved sideways between the weekly pivot 'R1' and the current day pivot 'r2'. Once Nifty was above 'R1', it started inching higher. Nifty made all-time new highs and current day High found its resistance exactly at daily pivot 'r4' spot on.