Nifty 50 trading strategy for 13th January

Nifty has closed 95 points down after a very volatile day. The prices opened flat and fell 200 points. The market then recovered completely and then went sideways. In the last 1 hour, the prices fell again and eventually closed around 95 points lower. The descending triangle was clearly visible yesterday and the prices fell in the first hour anticipating bearishness. However, when the prices recovered completely, I thought of a short covering move to the upside might happen. The prices did not take any support from the 9 EMA and do not go above the day high. Had there been a rejection from the 9 EMA and a new day high close, there was a long trade possible. The market went sideways and after that there was very little logic to go either long or short. The last move downward was difficult to trade as there was a strong move earlier today, indicating strong bulls at lower level. Anyways, none of our trading setups materialized and hence we should have avoided trading today.

Nifty 50 15 minute chart on 10th January

Short covering was anticipated

Nifty 50 trading strategy for 13th January.

Long setup

Scenario 1: Price open slightly gap up and then makes the first move to the downside and collect liquidity from either the previous day close or the pervious day low. After collecting liquidity, the prices make up an move and start trading above the last major swing high. If there is a close above 23537 and a rejection from the 9 EMA in 15 minute chart, then we can keep a target close to 23760.

Scenario 2: In this scenario as well, the prices open gap up but the gap up should happen above the 23537 level. The first move should be downwards and there should be rejection from the 23537 level and then the price should trade above the last swing high and 9 EMA. The targets can be again 23760.

Nifty 50 long trading strategy for 13th January

Short Setup

Scenario 1: Price open flat and then make the first move to the upside and take liquidity from the previous day selling swing. If the price then makes a new day low then we can expect it to go till 23300.

Scenario 2: Price open gap up near the 23537 level and then make the first move to the upside and go above 23537 and then gets rejected to the downside, below the last buying swing. And then if we see some rejection from the 9 EMA the price might go till the previous day low.

Nifty 50 short trading strategy for 13th January