You know! trading is a skill with a blend of art and principles. you master the principles with time and learn the art by adjusting your trading and psychological behavior. Most of what I am going to say next is going to be valid for Indian markets.
so what moves prices?
Its the fundamentals of the company. Companies which report who good sales with regular increase in EBITDA or profit margins see appreciation in the prices. Stock market discounts all the available news and gives you the price estimates. also the promoters or Big institutions with lot of money in their kitty buy these bulk and move them. They buy only when they see growth prospects. it means money attracts more growth.
Lets move on to patterns
- Breakout after long consolidation.
Market has 3 phases . Accumulating the stock during consolidation, breakout and rising it and finally profit booking where the big players dump their stocks and book profit. Identifying the phase in one such skill.
If it breaks on upper side, you get profit, the higher the length, the bigger the profit targets are!! Thats big money for you.
By far price action is the best technique to identify trading patterns. Choose stocks by breakout patterns, filter them by fundamentals, take a target of 2x with stop loss x for the trade. Remember all trades are probabilities only! They are not certain.
Here are some of the other patterns.
Stick to any of these patterns and maintain SL around 7% . Thats the premium we pay to the market to learn art of trading! Maintain 2-3 indicators and use these patterns.
18 Ema and 60 ema for uptrend confirmation helps!!