Here's a case study on Bharti Airtel Ltd. Below is the 5-Minute chart for the purpose of reference. The opening candle is marked in the chart. After opening near yesterday’s close, the scrip continued to slide down till 11:45 A.M. Since yesterday I had been following the price action of the above scrip. When the fall was arrested near 705 levels, I drew a channel. Price action respected the channel very well. I could see the price bounce off well in the context of the channel. I started to make a plan.
After price bounced back above current weekly pivot 'P' and 200-MA, I waited for the price to find support near the current daily pivot 'p'. All confirmations were in place. The RSI signaled price rise ahead.
I drew a trade box. The details of the plan are as follows.
Entry is at 708.9, stop is placed at 707.15, and the target is placed at 716. The Risk-Rewards ratio was 1:4.
This trade earned near 7 points. In fact, I had a
conservative target 714.5 decided by the implications of the recent minor
resistance marked by the circle. Later, I revised the target based on the
congestion zone marked by horizontal box. I must say I was lucky that the price hit planned target.
What about Nifty 50?
Nifty 50, for most part of the day, made downward sideways
correction. The broader index tested the earlier Resistance twice during the
day. The Resistance zone is marked by a horizontal box. Please refer the 5-Minute chart below.
