iCharts Discussions

[shekharinvest]

Starting this thread to trade breakouts in the stocks, all trades will be long only with medium term perspective. Post will be as and when opportunity presents itself and funds are available for investment

The setup is taken from freely available material from the internet and the credit goes to respective Authors and initial few charts are their creation this fact is acknowledged. I shall post charts from Indian stocks to make my point.

Happy Trading !
SHEKHAR

[shekharinvest]

SETUP



Before a stock makes our breakout “watch-list,” it must satisfy
two key criteria:

Stock must be in a clear and distinct uptrend
Stock must have a valid basing pattern


Stocks must be in a clear and distinct uptrend, as follows:

􀁺 20‐day EMA must be trading at or near the 50‐day MA when the stock
is forming a base and clearly above the 50‐day MA when in trend
mode. For pullback trades, the 20‐day EMA must be above the 50‐day
MA.
􀁺 20‐day EMA must be above the 200‐day MA
􀁺 50‐day MA must be above the 200‐day MA
􀁺 Both the 50 and 200‐day MAs must be in a clear uptrend for at least a
few months.
􀁺 The price action should be in an uptrend with a series of higher highs
and higher lows in place over the past 3 ‐ 6 months (at the very least).
􀁺 Current price should at least be 30 ‐ 40% above the 52‐week low.

Stocks must have a valid basing pattern

􀁺 A base (or zone of congestion) is anywhere from 1 month to 1
year in length. For our style of trading, we prefer bases that form
in a 1 - 3 month period that find and hold support of the 50-day
MA.
􀁺 We want to see “tight” price action in the base, especially during
the last two weeks before the breakout.
􀁺 A valid base should pullback anywhere from 10 - 30% off the
swing high. Once a stock retraces 40 - 50% or more, we begin to
question the strength of the uptrend.
􀁺 We must see a “higher low” form within the base. This is crucial
to the pattern. Without a higher low forming, we have no way to
set a stop and therefore can not define the risk.
􀁺 Volume should be declining during a base, or at the very least, not
heavier than average. If there are too many days of heavy
volume selling in a base, the base could be faulty.






NB: ST/ PT I have purposefully not deleted name of the trading group from the charts to acknowledge their work. I am not connected to them in any manner what so ever.

[shekharinvest]

A close look into the Basing Pattern and Breakout Entry

[shekharinvest]

Here is the chart of Igarashi Motors I shall be keeping an eye on, in the coming days.

That's enough work for a day

Happy Trading
SHEKHAR

[shaheerzaman]

Shekhar,

Thanks for starting such a nice thread. All the best.

I read the setup. For the below chart of igrasahi motors, i think you should wait for the 50 day MA to turn up. Right now its flat.

Thanks
Shaheer

[S.S.]

long trigeer in igarashi shekhar ????

[shekharinvest]

[shekharinvest]

Here is an another Chart for HINDPETRO which has given Breakout yesterday and long triggered above 862 SL is @ 797.

Happy Trading !
SHEKHAR

Chart is raw and dated Jan 04, 2016 hope ppl understand.