Banking sector saw some heavy selling this week, but it shouldn't come to us as a big surprise as most banks have been trading at very high prices, and more importantly, perilously close to their respective supply zones. BankNifty took the toll for obvious reasons, after a long struggle to cross the 41600 level, price was finally pulled down from deep inside the supply zone.
Index has dropped by almost 5% within a week, and as a result, we have just hit a recently created demand zone. This is the first retest of this demand zone since it was created, and we saw a very good rejection today where price easily sustained above the zone. I'm expecting the price to at least temporarily retract from these levels, which makes for a very affordable & low-risk long position for the coming week.
Rationale: - A fresh demand zone being re-tested, rejection with good volume. - Price has taken support at .786 fib-level. - Price has broken through 14-period ATR range on 30 Min and other smaller TFs. - RSI & Stochastic ascending on 1H and smaller TFs. - ADX indicating a loss of strength in the down trend.
Final Note: - This is supposed to be a quick trade, max 3 days(do not wait until the weekly expiry). - Exit criteria, either of the following, which ever happens first. >> - Target achieved >> - Stop loss reached >> - End of 3rd day of the trade - Do not go big, as this is a trade against the trend, but risk to reward is very good on this one(almost 1:5), so should it turn out positive, it'll be well-worth the wait.
Can you tell me how old the indicator tool you are using is?
sudoMode
⋅
@tranthuan1989hy, I'm sorry, how do you mean? I'm using three different indicators here, mainly relying on two of them(Trendly & Dynamo), and both of them are relatively new, I may have written them sometime earlier this year.
tranthuan1989hy
⋅
@sudoMode, sorry for my poor english . iwant to ask what the other % indicator is
sudoMode
⋅
@tranthuan1989hy, It's called Equilibrium, it indicates buying & selling pressure
tranthuan1989hy
⋅
@sudoMode,Can you please tell me the name of this indicator?