Introduction to

Price Action Trading

Presented by
Ganesan Dharanidharan
Certified Research Analyst
Secret Behind your
Stop-Loss
(Part – 5)
Presented by
Ganesan Dharanidharan
Certified Research Analyst
Branch Manager –ABFSPL, Puducherry
 One Strategy
Any Market – Any Time Frame
Stock – Commodity – Forex - Bonds
Big Boys Game
Institution Footprint
Institution Footprint
Institution Footprint
Institution Footprint
Candle Types
 Candle Types
Equilibrium Candle (E-Candle):

They imply that transactions are happening in a range thus

Buyer and Seller are in balance

Candle with Body Range <= 50% of Candle Range

High

Close

50%

Open

Low
 Candle Types
Im-Balance Candle (IB-Candle):

They imply imbalance between Buyer and Seller thus price starts
moving either up or down

Candle with Body Range > 50% of Candle Range

High
Close

50%

Low Open
 Candle Types
E or IB Candle:

High High High Close

Close

Close
50% 50% 50%
Open

Open Open
Low Low Low
 Candle Types
E or IB Candle:

High Close High High

Close
50% 50% 50% Close
Open

Open
Low Low Low Open
 Candle Types
E or IB Candle:

High High High

Open Open

50% 50% Open 50%

Close

Close Close
Low Low Low
 Candle Types
E or IB Candle:

High High High Open

Open
Open
50% 50% 50%
Close Close

Close
Low Low Low
 Buy Zone Formation
3 3
2
2
1
1 IB Candle

E Candle
IB Candle IB Candle Buy zone

Buy zone

E Candle IB Candle

Zone Formation – IB Candle - > E Candle - > IB Candle

 Sell Zone Formation

E Candle Sell zone

IB Candle

Sell zone
E Candle

IB Candle 1 IB Candle

2 IB Candle
3 1
2
3
Zone Formation – IB Candle - > E Candle - > IB Candle
 Zone Action
E- Candle
Sell Zone

IB Candle

Zone Formation – IB Candle - > E Candle - > IB Candle

Zone Reaction
 Zone Action

IB Candle

Sell E- Candle

IB Candle

Zone Formation – IB Candle - > E Candle - > IB Candle

Zone Reaction
Zone Reaction
Zone Reaction
 Zone Action

IB Candle

Buy zone E- Candle

IB Candle

Zone Formation – IB Candle - > E Candle - > IB Candle

Zone Reaction
 Zone Action

IB Candle

E- Candle Buy Zone

Zone Formation – IB Candle - > E Candle - > IB Candle

Zone Reaction
 Zone Formation

IB Candle IB Candle
Sell Zone

Buy Zone IB Candle IB Candle

Power Zone Formation – IB Candle - > IB Candle

Zone Reaction
Zone Reaction
Big Boys Game
 Zone Components
Entry Line – Closest line to the Current Market Price

Stop-loss Line – Farthest line from the Current Market Price

Stop-loss Line

Sell Zone

Entry Line

Entry Line

Buy Zone

Stop-loss Line
 Line Placement
Entry Line – Closest line to the Current Market Price

Stop-loss Line – Farthest line from the Current Market Price

Target Line

IB Candle

Entry Line
E- Candle
Stop-loss Line

IB Candle

Method 1 - Body To Wick

 Line Placement
Entry Line – Closest line to the Current Market Price

Stop-loss Line – Farthest line from the Current Market Price

Target Line

IB Candle
Entry Line

E- Candle
Stop-loss Line

IB Candle

Method 2 - Wick To Wick

 Line Placement
Entry Line – Closest line to the Current Market Price

Stop-loss Line – Farthest line from the Current Market Price

IB Candle
Target Line
E- Candle
Entry Line
Stop-loss Line

IB Candle

Method 3 - Body Low To Wick

 Equity Time Frames
Purpose Time Frame
Investment Daily
Swing Trading 60M
Intraday Trading 15M
Scalping 1M or 3M or 5M

Commodity Time Frames

Purpose Time Frame
Investment Daily
Swing Trading 4Hr
Intraday Trading 15M or 60 M
Scalping 5M
Indicator Traps
Indicator Traps
 Stock Screener
Stock selection parameters – Up Trend:

 FNO Stocks

 15M Close >= 15M 12EMA

15M 12EMA > 15M 26EMA

 1H Close >= 1H 12EMA

1H 12EMA > 1H 26EMA

 2H Close >= 2H 12EMA

2H 12EMA > 2H 26EMA

 1D Close >= 1D 12EMA

1D 12EMA > 1D 26EMA

 Daily Volume > 1000000

 Daily Close > 100

Stock Screener
 Stock Screener
Stock selection parameters – Down Trend:

 FNO Stocks

 15M Close <= 15M 12EMA

15M 12EMA < 15M 26EMA

 1H Close <= 1H 12EMA

1H 12EMA < 1H 26EMA

 2H Close <= 2H 12EMA

2H 12EMA < 2H 26EMA

 1D Close <= 1D 12EMA

1D 12EMA < 1D 26EMA

 Daily Volume > 1000000

 Daily Close > 100

Stock Screener
 Zone Formation

Note: First Candle should be an IB candle

The Second and Third low candles can be an E or IB Candle
 Zone Marking

Note: First Candle should be an IB candle

The Second and Third low candles can be an E or IB Candle
 Zone Marking

Note: First Candle should be an IB candle

The Second and Third low candles can be an E or IB Candle
 Zone Marking

Note: First Candle should be an IB candle

The Second and Third low candles can be an E or IB Candle
 Zone Formation

Note: First Candle should be an IB candle

The Second and Third low candles can be an E or IB Candle
 Zone Marking

Note: First Candle should be an IB candle

The Second and Third low candles can be an E or IB Candle
 Zone Marking

Note: First Candle should be an IB candle

The Second and Third low candles can be an E or IB Candle
 Zone Marking

Note: First Candle should be an IB candle

The Second and Third low candles can be an E or IB Candle
 Zone Formation

Note: Power Zone is formed with 2 IB candles without any E candle

 Zone Marking

Note: Power Zone is formed with 2 IB candles without any E candle

 Refining Time Frame
The zone plotted dose not support R:R. Then we can check for zone in Lower Time
frame.

Eg: Zone plotted in 5 Min candle can be refined by 1 or 3 Min

Zone plotted in 3 Min candle can be refined by 1Min

5 Min Zone 3 Min Zone 1 Min Zone

(12 Tick) (8 Tick) (5 Tick)
Refining Time Frame

5 Min Zone
Refining Time Frame

3 Min Zone
Refining Time Frame

1 Min Zone
 High POP Setup

Divide the Prev. day into 3 Parts.

Part 1 – Check only for Sell Zone
Part 2 – No Trade area
Part 3 – Check only for Buy Zone
Fib Retracement
Pivot Correlation
MA Correlation
 ST&BT Strategy
Criteria for enabling Flag:
• Wick should be more than 320% of the body of the candle
• Body of the candle should close with in 30% of the length of the candle.

Length of the candle (100%)

30%
Close
Body

Wick

Open
S.E.T for ST&BT
S.E.T for ST&BT
S.E.T for ST&BT
S.E.T for ST&BT
 Candle Pivot
Candle Pivot Point – (High + Low + Close) / 3

High Close

Open

Low
 ST&BT Entry Method
Candle Pivot Point – (High + Low + Close) / 3

High Close High Close

1st & 2nd Lot 1st Lot

Open Open
2nd Lot

Low Low
Candle Pivot
Odds to enhance
ST & BT
Pivot Confluence
MA Confluence
Zone Confluence
Screener Stocks
Confluence
“I do not undertake the
work unless I see my way
clear to a profit”
- Jesse Livermore
 Standard Floor Pivots
R3 = R1+ (High – Low)

R2 = Pivot + (High – Low)

R1 = 2*(Pivot - Low)

Pivot = (High + Low + Close)/3

S1 = 2*(Pivot – High)

S2 = Pivot - (High – Low)

S3 = S1 - (High - Low)
Buy – S1, S2 or S3
Sell – R1, R2 or R3
Buy or Sell - Pivot Point
Standard Floor Pivots
VS
Expanded Floor Pivots
 Expanded Floor Pivots
=
Standard Floor Pivots
+
R4 = R3+ (R2 – R1)

TC = (Pivot –BC) + Pivot

Pivot = (High + Low + Close)/3

BC = (High + Low)/2

S4 = S3 - (S1 – S2)
 Expanded Floor Pivots
R4 = R3+ (R2 – R1)
R3 = R1+ (High – Low)

R2 = Pivot + (High – Low)

R1 = 2*(Pivot - Low)

TC = (Pivot –BC) + Pivot

Pivot = (High + Low + Close)/3
BC = (High + Low)/2

S1 = 2*(Pivot – High)

S2 = Pivot - (High – Low)

S3 = S1 - (High - Low)
S4 = S3 - (S1 – S2)
 Central Pivot Range (CPR)
TC = (Pivot –BC) + Pivot

Pivot = (High + Low + Close)/3

BC = (High + Low)/2

Secret characteristics of CPR:

 Trend Analysis
 CPR Width Forecasting
 Two days pivot range relationships
 Secrets of
Extended Floor Pivot
 Trend Analysis
Trend Analysis
Higher Value Bullish (Up Trend)
Lower Value Bearish (Down Trend)
 Trend Analysis

Step Up Ascending Pivot

Higher Value
Trend Analysis
 Trend Analysis

Step Down Descending Pivot

Lower Value
Trend Analysis
What if “U” know this before
SBIN
Reliance
Adani Ports
 CPR Width Forecasting
CPR Width Forecasting
Narrow CPR Breakout
Wide CPR Sideways
SBIN – Narrow CPR
Reliance– Narrow CPR
Adani Ports– Narrow CPR
Nifty – Wide CPR
Nifty – Wide CPR
Nifty – Wide CPR
Nifty – Wide CPR
 Two-day Pivot
Range Relationship
Two-Day Pivot Relationships
Unchanged Value Sideways/Breakout
Inside Value Breakout
Outside Value Sideways
Overlapping Higher Value Moderately Bullish
Overlapping Lower Value Moderately Bearish
Unchanged Value
Unchanged Value
Inside Value
Inside Value
Inside Value
Inside Value
CPR Jackpot Setup
CPR Jackpot Setup
Outside Value
Outside Value
Overlapping Higher Value
Overlapping Higher Value
Overlapping Lower Value
Overlapping Lower Value
 Standard Camarilla Levels

H4 =Close + Range*1.1/2
H3 =Close + Range*1.1/4

H2 =Close + Range*1.1/6

H1 =Close + Range*1.1/12

L1 =Close - Range*1.1/12

L2 =Close - Range*1.1/6

L3 =Close - Range*1.1/4
L4 =Close - Range*1.1/2
 Expanded Camarilla Levels
H5 =Close *(High/Low)
H4 =Close + Range*1.1/2

H3 =Close + Range*1.1/4

H2 =Close + Range*1.1/6

H1 =Close + Range*1.1/12

L1 =Close - Range*1.1/12

L2 =Close - Range*1.1/6

L3 =Close - Range*1.1/4
L4 =Close - Range*1.1/2

L5 =Close – (H5 – Close)

 Expanded Camarilla Levels
H5 - Breakout Target

H4 - Bullish Breakout

H3 - Sell Reversal

L3 – Buy Reversal
L4 – Bearish Breakout

L5 – Breakout Target
 H3 Reversal Trade

Stop @ H4

Entry @ H3

Target @ L3
H3 Reversal Trade
 L3 Reversal Trade

Target @ H3

Entry @ L3
Stop @ L4
L3 Reversal Trade
 H4 Breakout Trade

Target @ H5

Entry @ H4

Stop @ H3
H4 Breakout Trade
 L4 Breakout Trade

Stop @ L3
Entry @ L4

Target @ L5
L4 Breakout Trade
 Camarilla Trend Analysis
Trend Analysis
Higher Value Bullish (Up Trend)
Lower Value Bearish (Down Trend)
 Camarilla Width Forecasting
CPR Width Forecasting
Narrow CPR Breakout
Wide CPR Sideways
 Two-day Camarilla
Range Relationship
Two-Day Pivot Relationships
Unchanged Value Sideways/Breakout
Inside Value Breakout
Outside Value Sideways
Overlapping Higher Value Moderately Bullish
Overlapping Lower Value Moderately Bearish
 CPR & Camarilla Relationship

High POP Breakout Trade setup

 CPR & Camarilla Relationship

Low POP Breakout Trade setup

CPR & Camarilla Relationship

High POP Reversal Trade setup

CPR & Camarilla Relationship

Low POP Reversal Trade setup

 Upcoming Session
Topics To be covered in upcoming webinars:
 How to draw Trend Line (2 sessions)
 Introduction to Options (1 session)
 Option Strategies (3 session)
 Instruction
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