One of the strongest pattern is a gap-up on the weekly chart that stays unfilled. More often than not, the price will pullback & retest the high of the gap, & give us a buying oppurtunity.
e.g EXCELINDUS - entry above high of 24 Feb candle
e.g EXCELINDUS - entry above high of 24 Feb candle
If this weekly gap-up coinicides with a new-high base breakout, itβs even much stronger. As per Oβ Neil, gap-ups that are also base breakouts are the most powerful base breakouts.
e.g MBAPL - entry above high of 22 Feb candle
e.g MBAPL - entry above high of 22 Feb candle
Another recent example of weekly gap-up + base breakout is UGARSUGAR. Entry above high of 22 Feb candle:
In all weekly gap-ups, the volume on the gap-up day should be at least twice of the 50-day MA of daily volume.
A big-volume gap-up move leading to breach of the previous high can also be considered as a base breakout.
e.g. GNFC: entry above high of 24 Feb candle
A big-volume gap-up move leading to breach of the previous high can also be considered as a base breakout.
e.g. GNFC: entry above high of 24 Feb candle
We donβt know which gap would stay unfilled. Low of the gap-up candle is the SL.
e.g. METROBRAND: here the gap didn't sustain. We could still enter above high of 21 Feb candle. Trade never gets triggered, instead we get a decisive close below it, & the setup gets invalidated.
e.g. METROBRAND: here the gap didn't sustain. We could still enter above high of 21 Feb candle. Trade never gets triggered, instead we get a decisive close below it, & the setup gets invalidated.
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