Tata steel might offer a potential price action setup for swing and positional traders. Market participants should keep an eye on decision point at 600, any pattern or opportunity must form in the context of decision point itself. Analysis is on weekly chart; resulting structure or formation can be traded on both daily and weekly time frame.
Prices are trading in a channel structure since 2016, I have highlighted several times about this Market structure in previous articles. Though the channel is moving upside, market sentiment still remains random, both buying and selling pressure is offsetting each other. It technically indicates temporary equilibrium conditions which is favorable for mean reversion trading. We can look for either breakout or range trading opportunities in the channel.
Prices are near decision point 600 (It’s also a psychological round number). Market bias and sentiment depends on how prices are going to behave at this decision point. Since present conditions are favorable for mean reversion opportunities, we must wait for pattern formation and take trades according to developing structure. Keep Tata steels on your watch list for coming days.
