Markets are quite volatile from last couple of weeks due to Geopolitical issues such as Coronavirus and Economic stability. Finding Trading setups in this type of Market conditions can be quite challenging for traders, especially the ones who’re trading in lower time frame. Being said that, there are still opportunities we can find in higher time frame charts.
SBI is one of the few stocks that have recently formed a trading setup which is likely suitable for swing traders. Take a look at the Daily chart of SBI Share prices.
SBI – Price Action Analysis on Daily Chart
SBI share prices are moving in a Downward Range from last few months. Overall, it’s trading between a parallel support and resistance zone of 340 – 300. Even though prices are moving lower, we can notice the rallies and selloffs within the Range which indicates the presence of both buyers and sellers in the Stock.
Sellers made multiple attempts to push the prices lower. Take a look at Point no 2 – Notice how one of the attempts to push the prices below the parallel support zone turned into a Breakout Failure. Based on the Price Action, it seems like strong inflow of Buy orders are entering into the market after each attempt to push the prices lower has failed.
In the recent days, once again prices have broken the Parallel support zone at 296 – 300. The major difference between the current breakout and the previous one is the Momentum. In the recent breakout we can clearly see a strong downside momentum – Take a look at Point no 3.
Watch the Price Action after the Breakout. If Price Action turns out as a retest, then prices might fall further. On the other hand, if prices bounce back sharply then the Breakout could end up as a Failure. Keep an eye on the Price Behavior in coming days and take trades accordingly.
