Nifty Range

Day trading in Nifty redefined using ATR

Nifty trading range for : 25 - October - 2016
Previous close : 8,708.95

Last traded price : 8,691.30

Buy Zone : From 8659.95 to 8635.45

Breakdown below : 8630.55 (stop loss for intraday longs)

Breakdown target : 8575.65

Sell Zone : From 8757.95 to 8782.45

Breakout above : 8787.35 (stop loss for intraday shorts)

Breakout target : 8810.45

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Important notes :

1) This site is for education purpose only and no liability should be assigned to this site or its owners for any profit or loss that one may incur based on studies published on this site.

2) The method that is under discussion above is based strongly on ATR (Average True Range), which is formed in accordance with the tops & bottoms formed during daily trading sessions. A low is formed when sellers do not want to sell any more. A high is formed when buyers want to buy no more. A trading range is formed thus, and a moving average of a number of sessions forms the ATR.

3) This study also assumes that both the Bulls and the Bears try to stretch this trading range in their favour and that in such a stretch there are zones where they both get "tired" and infliction points where both get "charged up"

4) This study suggests that one should buy when the Bears get weak (i.e. in the Buy Zone) and sell when Bulls get weak (i.e. in the Sell Zone) with a Stop loss of breakdown and breakout points respectively.

5) If niether of these zones are reached within a particular trading session, then the study assumes that the Nifty is "consolidating" and suggests one to not open fresh positions, but continue to hold positional longs or shorts as the case maybe.

6) This study also advises the above method to be used in conjuction with other trend identification tools like ADX RSI MAs etc.

7) This study does not purport to predict the levels on the Nifty, but only indicates probable moves when particular levels are reached or breached.