Free Stock market / Nifty intraday tips, FREE Stock, Commodity & Forex tips

The Ultimate Price Action Breakdown Strategy

Free nse stock industower chart calls

Free nse stock industower chart calls

Preface:

Alright, the operation started after creating an extreme low at 120.20. Price has created an upward channel from the extreme low, where the equilibrium has occurred between bull and bear traders. Control line has given eleven touches, which shows the strong gravitation at the middle.

Here, we can see four reversals on the upper band, and three reversal points occurred on the lower band.

We have two opportunities:

1. Now, the price is on the H-line, and the breakout of the h line indicates the lower band touch.

2. Bull can buy at excess, or they can enter at reappearing in the value area for the target of the control line.

Every beginner who wants to start trading with naked strategy (without indicator) can use this method because the price is the thing that will pay you.
Let me explain to you important aspects of the breakdown strategy.

Value area:

A zone in which bulls and bears both are satisfied to stay within it.
In this zone, supply and demand equally exist.

Value area has two bands:

1. Upper band

2. Lower band

Ascending Value area:

Free nse stock industower A chart calls

Range-Bound Value area:

Free nse stock industower RB

Descending Value Area:

Free nse stock industower D chart calls

Upper band:

Upper band indicates demand-supply.
In this chart, the price has taken four reversals from the upper band to maintain the equilibrium.
The upper band put a stop to the bull power.

Lower Band:
The lower band indicates demand pressure.
In this chart, the price has taken three reversals from the lower-band to maintain the equilibrium.
The lower band put a stop to bear power.

No trading zone:
In order to respond to either bull or bear’s initiative, the price creates an area. In which no trading activities have taken.
It helps to find the weakness of any particular move.

H Line.
After completing the last share move, the price creates the bulk trading activities, where bulls’ power becomes dull.
Breakout of the H-line indicates the cease of the particular move.

Excess:

Excess is regret and fake-out.

In simple words, price breaks the upper band and again re-enter into the parallel channel. Buying or selling at the excess is the perfect deal.

An excess is a signal of reversal.

The psychology behind the control line:
Price is forming in the parallel channel, but bulls are not satisfied with the current trend. That’s why bulls increase demand pressure to break the upper band of the value area. After breaking the upper band, bulls face some problems with profit booking. Now, bulls realize that the price is not going up.
Bulls give up on the thought of trend change.
Bears were watching this patiently. And after they realize that prices are too high, they increase supply pressure above the upper band of the channel. Now bulls are out of the market, and the seller has maintained the equilibrium & Vice versa.

Control line:

The Control line is the gravitation point of any value area. We can draw by connecting the reversal points in the middle.
The more the points are available, the higher the effectiveness.

Please note that the price can not stay away from the control line of the value area. We can use it as a price target or breakout trade.

Here, the price has given eleven touches on the control line.

Breakout or breakdown of the channel:
Bulls and bears both disagree with the current price trend.
Either bulls or breaks out the value area by giving consistent closing.
It often happens after a complex correction or trend change.

To become a subscriber, subscribe to our free newsletter services. Our service is free for all.

Get free important share market ideas on stocks & nifty tips chart setups, analysis for the upcoming session, and more by joining the below link: Stock Tips

Have you any questions/feedback about this article? Please leave your queries in the comment box for answers.

Disclaimer: The information provided on this website, including but not limited to stock, commodity, and forex trading tips, technical analysis, and research reports, is solely for educational and informational purposes. It should not be considered as financial advice or a recommendation to engage in any trading activity. Trading in stocks, commodities, and forex involves substantial risks, and you should carefully consider your financial situation and consult with a professional advisor before making any trading decisions. Moneymunch.com and its authors do not guarantee the accuracy, completeness, or reliability of the information provided, and shall not be held responsible for any losses or damages incurred as a result of using or relying on such information. Trading in the financial markets is subject to market risks, and past performance is not indicative of future results. By accessing and using this website, you acknowledge and agree to the terms of this disclaimer.

Previous ArticleNext Article
Mr.Guru(s) is a team of stock market certified technical and research analysts with over 20 years of experience. They are regular guests on popular online channels and contribute articles to several financial publications. Their insights and advice are respected by investors worldwide. With their collective knowledge and expertise, they have a proven track record of successfully predicting market movements and identifying profitable opportunities.

Join Today (Free): Stock & Nifty Tips

3 Comments

Write a Comment

Comment Policy: We love comments and appreciate the time that readers spend to share ideas and give feedback. However, all comments are manually moderated and those deemed to be spam or solely promotional will be deleted. Your email address will not be published. Required fields are marked *

Send this to a friend