How to catch Momentum using Ichimoku cloud and price pattern

 It is possible to capture good moves in stocks using price patterns along with simple indicators like Ichimoku cloud. See how we identified such move in WELSPUNIND.

Ichimoku cloud - The Ichimoku Cloud is a technical tool that indicate the support and resistance, identifies trend direction, gauges momentum and provides trading signals.

The Following research is picked up from our daily Equity Research Report which our subscribers receive pre-market every day.

WELSPUNIND Daily chart as on 01^st August 2023

WELSPUNIND 60 mins chart as on 01^st August 2023 

Wave analysis as published on 01^st August 2023

Welspun India closed with a massive gain of 9.32% after the company’s total income grew 11.9%. On the daily timeframe, as we can see in the chart from the past three months prices was consolidating in a Triangle pattern. Due to sharp move prices gave a close above the 104 levels which confirms breakout of the said pattern and sudden rise in volumes acted as a double confirmation. On the other hand, base line (red) has acted as a support and every time stock has bounced back on the upside by taking support of the same. So, as per this nearest support is at 100 levels.

On the hourly chart, we have applied parabolic SAR which used to determine the price direction as well as draw attention to when the price direction is changing. A single Parabolic SAR have formed below the price which suggest that short term bias might turned bullish but more price action is required to confirm the same.

Trend for Welspun India looks bullish. Any dip towards 105 can be used as a buying opportunity for a move towards 122 as long as 100 holds on the downside.

 Happened as on 23^rd August 2023

As we expected stock after a dip witnessed a good rally of more than 19% within less than a month. Stock achieved our target of 122 and made high of 125.4 after giving breakout of the Ascending Triangle pattern. In such choppy market we have managed to identify such stock with the help of simple chart pattern. If we combine simple price action with price patterns then it together works like magic!!

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Nifty Volume profile for Options Trading

Volume profile indicates big players activity and same can be applied prudently even for Options Trading.

Options Trading requires understanding of momentum, trend, time to expiry and range.

Majority focus only on Open interest but by combining change of Open interest along with Volumes on stocks, indices the overall perception can sharply increase.

Trading conviction increases using this techniques of Trading.

Nifty hourly chart Volume profile

Nifty 19800 Call Option 17^th August 2023

Nifty hourly chart shows that there is big volume buildup at 19500 (fut) and 19800 (fut) levels. This can be seen from right hand side volume area.

The buildup at 19500 (fut) along with Open interest analysis confirms that Bears have to take prices below this level to trap the bulls on upside. Whereas break above 19800 is must for positive resumption.

Nifty call option chart – As we see sharp volumes around 19800 levels we have applied Volume profile directly on 19800 strike price call option. This chart shows volume near 50 levels and break below 30 can result into downtrend on this strike prices.

So by simply using volume profile analysis one can form trading strategy on Nifty Options. Like above one can look forward to sell 19800 strike price Option of 17^th August expiry below 30 with stoploss of 50 and target to 0 levels.

In a nutshell, Volume profile is must tool for Options trader and can be applied for Options buying strategy also.  

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Nifty Fibonacci Retracement, Elliott wave with Time cycle

Elliott wave is GPS of the market and this combined along with advanced technical analysis studies can give precise entry opportunity especially for Options Traders.

Time Cycle helps you identify optimal entry and exit points in the stock market

We derived path of Nifty much ahead on 05th August 2023 with 1000’s of participants during live webinar.

Below is the chart of Nifty on 15 minutes with 43 period Time cycle.

Nifty hourly chart (Anticipated on 5^th August)

NIFTY 15 minutes chart (Anticipated on 5^th August)

Nifty 15 minutes chart – Happened so far as on 7^th August 2023 

Elliott wave analysis – Nifty first chart showing inverted Head and Shoulder pattern along with Elliott wave counts. Fibonacci retracement of 61.8% was used to derive the 1^st target which was at 19609 with initiate level above 19540 that too around the Time cycle mentioned below.

Time cycle - The above chart shows the time cycle of 43 period on a 15-minute scale. The vertical lines represent the area of the time cycle where short-term upward reversals can be observed. As shown in the first chart, we anticipated a move on the upside from 11am on 7^th August Monday. Prices made a low exactly at that time near 19532 and reversed back on upside crossing above the intraday target of 19609 levels.

Happened – Nifty moved precisely as per the set blueprint. Prices made a low near 11am giving good opportunity for Option traders to buy calls or short puts and rushed towards the target of 19609. Also further positive break above 19620 will open Head & Shoulder target levels of 19800/

In summary, we can see how technical analysis pattern like H&S is combined with Elliott wave and Time cycle to give precise trading opportunity and setup. Trading Options can be easy if this science of technical analysis is known completely.

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Nifty: Bang On using Neo Wave and Price indicator

Neo wave along with simple price indicator helps to form powerful setups with a good accuracy.

We published the following research on 2nd August, 2023 (pre-market) in – The Financial Waves short term update.

Nifty Daily chart as 2^nd August 2023 (Anticipated)

Nifty 60 mins chart 2nd August 2023 (Anticipated)

Wave analysis as on 2nd August 2023:

After a sharp recovery, in the previous session Nifty witnessed a consolidation. The market started the day with marginal gains but witnessed profit booking in the initial hours and remained rangebound during the day.

On the daily chart, we have shown Bollinger Bands. Wherein, we can see that prices have bounced back from mid bands. Also, Gann level of 19952 is acting a major hurdle. Post completion of wave a at the top we are seeing stock specific action but everything looks to have slowed down. With Lunar cycle - Pournima on 2nd August we can expect a trending move to emerge. Decisive break above 19830 will result into retest of Gann 19952 on upside whereas on downside 19600 is important support. As of now this is intraday traders market and break below 19700 can take prices to 19640 over short term but since we are seeing whipsaw movement it is best to sell options as of now as long as the broad range of 19600 - 19830 remains intact.

On the hourly chart, Adx is trading near 9 suggesting lack of momentum which often results into sideways action or range bound movement.

In nutshell, Nifty is moving in a lacklustre fashion. prices are forming triangle pattern and breakout can be seen soon. For now, any move above 19830 is must for uptrend to resume. While on the downside nearest support is near 19700 levels. Any breach below 19700 can drag the price lower towards 19640 followed by 19600 levels.

Happened:

Earlier Nifty was trading in a range. However, after giving a break below 19700 prices not only achieved our target of 19600 but also made a low of 19519 which is way below from our mentioned levels.

This clearly shows that by combining price action and indicators one can easily identify wave patterns which works like magic!

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