Context:
On the 22nd of May, 2024, NIFTY traded near its resistance level of 22586 throughout the day. Due to the Bank NIFTY expiry, prices remained muted until the last 30 minutes, when we saw a breakout. NIFTY closed above the resistance level of 22586, confirming an upward move for the next trading session on the 23rd of May.
Trading Strategy:
Gap Up Opening (22700-22750):
If NIFTY opens above 22700 and sustains this level during the first trading hour, it can move higher towards the target of 22800.
Expect resistance near 22800.
If prices do not sustain 22700 and start trading below this level, look for buying opportunities near 22600-22580.
If prices break 22550, consider a short trade with a stop loss (SL) at 22590 and target 22465-22443.
Flat Opening (Above 22600):
If NIFTY stays above 22600, aim for a target of 22700.
Above 22720, the prices can target 22800-22810.
Look for buying opportunities with a SL at 22550.
If prices start trading below 22550, wait and look for buying opportunities near 22465-22432 with a SL of 22400 and target 22580-22600.
Gap Down Opening (Below 22538):
If prices quickly recover and stay above 22600, aim for a target of 22700-22800 with a SL below 22550.
If prices do not recover and stay below 22532 for the first trading hour, consider a short trade targeting 22465-22443.
Below 22400, prices can potentially drop to 22300.
Conclusion:
Be prepared for different market conditions by setting appropriate stop losses and targets. Adjust your strategy based on the opening and early price movements.
Disclaimer:
This trading plan is based on technical analysis and market conditions at the time of writing. Market conditions can change rapidly, and it is important to conduct your own analysis or consult with a financial advisor before making any trading decisions.
Trade closed: target reached