I had posted support and resistance levels for BNF (BANK NIFTY FUTURE) on the request of some readers.
Today i got a question from the reader on how to trade BNF levels.
The answer is pretty simple. Like any PIVOT trading system.
Ok now how do you trade pivots. As a trader, you wait and watch till market makes a move and follow the maket with patterns, candle reversals etc.
I am posting BNF 15 minue chart here. This was the cleanest trade possible.
BNF traded above R1 for quite some time indicating that trend is going to be bullish.
Breaking above the rectangle and a seemingly double top pattern, above 8792 it was clear buy. The chart should illustrate that
Now having bought a 8792 the 15 minute bar closes is at 8862. But one look at the volume and you know more is coming. Therefore you hold the position.
You have a doji at 2.30. Time to take the first profits here. By that time price is 8952 a whopping 160 bucks above your buy price.
One more reason to take off profit is 8952 is above R4 level.
Now you wait and at 15.15 market makes another doji where you book the last profits at 8972.
Quite obviously your initial SL would have been at the rectangle low.
It might sound and look simple, but real time trading using piVoT leVels will involve good knowledge of trendlines and
more than moderate knowledge of reversal patterns and skill to identify volume break out.
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