Ever wonder why a price corrects after opening gap up or price moves up after a dip.
Have you noticed this in stock market?
This phenomenon is called Climax.
This thread would on
"How to trade Climax"
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So far, nobody shared or discussed Climax phenomenon and this was just a mere observation for us.
If you haven't seen any example of climax yet, then let's see an example:
This happened with Tata Steel today in intraday today.
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Climax is the last/ending phase of the trend in stock market.
There are two types of climax based on the trend in market:
1. Bullish Climax
2. Bearish Climax
Shared example of both below.
Let's dig into each of these and see what would be a trading setup.
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Bullish Climax:
As name suggests, it is the ending phase of bullish move/trend. After this price starts downtrend.
Setup:
1. Price should open gap up by over 2%
2. Mark mid point of opening candle. Go short if price is below this.
3. Opening candle's high would be stoploss
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Use this climax trading setup only in #Intraday and use 5 mins time frame chart.
Let's see an example of a bullish climax that happened in Tata Steel today.
Entry got triggered (1317) at 9:20pm when the candle was below the reference point. Trailing SL got hit at 1286.
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