1 00:00:00,120 --> 00:00:06,900 Now, I will tell you how you can calculate the risk and reward on the bullish engulfing pattern that 2 00:00:06,900 --> 00:00:07,810 you are trying to trade. 3 00:00:08,400 --> 00:00:14,600 So we have seen two filters where you have to initiate a trade when market is falling. 4 00:00:14,610 --> 00:00:19,550 That was take one and second market open bullish. 5 00:00:19,560 --> 00:00:20,490 That was tech, too. 6 00:00:20,970 --> 00:00:23,970 So these two techs were there. 7 00:00:24,180 --> 00:00:26,370 Now we can consider this trade. 8 00:00:26,940 --> 00:00:32,940 But the third filter that we have to apply here is that this reward, risk reward is not favorable and 9 00:00:32,940 --> 00:00:34,470 we are not going to make this trade. 10 00:00:34,980 --> 00:00:38,430 So I told you, for risk reward, we have to use two metrics. 11 00:00:38,430 --> 00:00:46,950 That is ETR average to range for finding out the risk and the resistance to find out the reward. 12 00:00:47,250 --> 00:00:53,520 So let's quickly do this on Isba and see whether we can take this trade or not. 13 00:00:54,690 --> 00:01:00,230 So as I told you that, first we have to calculate the risk that is involved. 14 00:01:00,690 --> 00:01:04,920 So our stop loss will be one if they are below the low of this scandal. 15 00:01:04,940 --> 00:01:08,560 So this is the low of our previous scandal. 16 00:01:08,790 --> 00:01:10,300 So one ETR below. 17 00:01:10,320 --> 00:01:14,910 So what is the ETR currently as far as this scandal is concerned? 18 00:01:15,210 --> 00:01:23,100 There is approximately 10 on the right side and the low is to seventy four to seventy minus 10. 19 00:01:24,030 --> 00:01:34,160 That is 260 to 260 will be our stop loss point, so let's put this stop loss point on the chart. 20 00:01:34,650 --> 00:01:38,670 So this is where we have stopped loss to 60. 21 00:01:39,740 --> 00:01:45,150 This where we will exiting laws and how you calculate the profit profit is next registered. 22 00:01:45,170 --> 00:01:46,440 So what are the next results? 23 00:01:46,470 --> 00:01:53,190 This one, because this is the level from where the market reverts to this level, registered the price 24 00:01:53,190 --> 00:01:53,860 to go up. 25 00:01:54,090 --> 00:01:55,950 So this will be our immediate target. 26 00:01:56,470 --> 00:01:58,440 So you can see somewhere here. 27 00:01:58,770 --> 00:02:01,120 OK, so 309 310. 28 00:02:01,140 --> 00:02:01,920 This will be our. 29 00:02:02,980 --> 00:02:03,850 Profit target. 30 00:02:05,380 --> 00:02:13,200 Now, when we are going to make entry, we are going to enter at this point because this is where market 31 00:02:13,210 --> 00:02:14,820 open bullish. 32 00:02:14,860 --> 00:02:16,210 So this is our entry point. 33 00:02:16,210 --> 00:02:17,570 This is our stop loss. 34 00:02:17,580 --> 00:02:18,930 This is our target. 35 00:02:18,940 --> 00:02:23,520 Now, we will calculate whether the risk reward is in our favor or not. 36 00:02:25,420 --> 00:02:26,440 This is the point. 37 00:02:27,610 --> 00:02:28,810 And, uh. 38 00:02:29,900 --> 00:02:31,790 This is the race. 39 00:02:33,130 --> 00:02:34,680 This is the war. 40 00:02:36,700 --> 00:02:44,020 So as you can see, this reward is almost zero point nine five something which is almost one to one. 41 00:02:45,150 --> 00:02:48,600 Very tight one, but we can go for it. 42 00:02:48,630 --> 00:02:56,910 OK, so it is not very adverse, one point risk, one point the world, so we can initiate this drill 43 00:02:57,180 --> 00:03:00,960 and you can see kind of it achieved its target within a day or so. 44 00:03:00,960 --> 00:03:02,700 Next can achieve the target. 45 00:03:03,680 --> 00:03:08,600 So this is an example where we traded the bullish engulfing successfully. 46 00:03:08,870 --> 00:03:11,840 I'll give you another example, Reliance Industries. 47 00:03:12,990 --> 00:03:15,040 So we saw that on the lens industry. 48 00:03:15,070 --> 00:03:20,150 This was bullish engulfing and it came in falling market and this scandal was bullish. 49 00:03:20,310 --> 00:03:26,210 We can consider this trade, but now let's see if we can see the risk reward then. 50 00:03:26,220 --> 00:03:28,050 Is it lucrative or not? 51 00:03:28,770 --> 00:03:30,960 So quickly calculate the. 52 00:03:32,020 --> 00:03:32,980 Stop loss here. 53 00:03:33,970 --> 00:03:45,550 This is the law and it is sixty nine, almost seventy one eight three seven minus 70, so one seven, 54 00:03:45,550 --> 00:03:46,150 six, seven. 55 00:03:46,180 --> 00:03:50,050 This is the stop loss level one seven, six, seven. 56 00:03:53,740 --> 00:04:00,210 You can always adjust the level one seven, six, seven, so this is where we will exit in Los Angeles, 57 00:04:00,220 --> 00:04:05,200 market with rate and profit is next immediate resistance. 58 00:04:05,590 --> 00:04:12,880 Now, you may confuse next immediate resistance with this, because this is the immediate resistance 59 00:04:12,880 --> 00:04:13,720 that you can see. 60 00:04:14,320 --> 00:04:22,570 But this is this will be long, because if you trade long enough in the market, you'll understand that 61 00:04:22,870 --> 00:04:27,890 the support of the previous support becomes resistance. 62 00:04:28,120 --> 00:04:33,720 So in this case, you can see this was the support level from which the market bounced many times. 63 00:04:34,180 --> 00:04:39,370 So normally you will find out that this support level will act as a resistance. 64 00:04:39,610 --> 00:04:44,300 OK, so this support support becomes resistance if you know the situation. 65 00:04:44,950 --> 00:04:53,170 So basically our target will be to 075 since this is an immediate resistance and at what point we are 66 00:04:53,170 --> 00:04:54,630 entering, we're entering here. 67 00:04:55,060 --> 00:05:01,450 But as I told you, that you don't have to at the end of this of enter at the open of this candle, 68 00:05:01,450 --> 00:05:02,080 which was green. 69 00:05:02,620 --> 00:05:03,820 So now if we put. 70 00:05:05,100 --> 00:05:15,150 The risk reward equation here, you can see this is our risk and this is the reward that we are taking. 71 00:05:16,080 --> 00:05:20,440 And you can see that this reward is zero point six for which is adverse. 72 00:05:20,460 --> 00:05:25,340 We are taking a risk of one rupee to gain reward of zero point six four. 73 00:05:25,730 --> 00:05:27,970 So this is not a good risk reward ratio. 74 00:05:28,110 --> 00:05:29,850 We can ignore this trade. 75 00:05:30,570 --> 00:05:32,900 We can look for another another trade. 76 00:05:33,330 --> 00:05:35,370 The market will give you ample opportunity. 77 00:05:35,410 --> 00:05:41,580 There are more than 6000 companies on BSE and more than one thousand nine hundred companies on NSC. 78 00:05:41,940 --> 00:05:46,010 And in that also you will see 300 to 400 companies. 79 00:05:46,020 --> 00:05:49,850 They are very good and liquid companies with good volumes. 80 00:05:50,220 --> 00:05:59,220 So you will get one to two bullish engulfing Hanmer, bullish, piercing, etc. in a week, easily you 81 00:05:59,220 --> 00:06:06,180 will get so even if you get hold of at least one to two of such patterns among these two three shares, 82 00:06:06,750 --> 00:06:09,000 then it will work for you. 83 00:06:09,300 --> 00:06:15,030 So as far as this trade is concerned, I am not going to interrupt because you can see that market went 84 00:06:15,030 --> 00:06:19,560 up and it took this support as a resistance once and twice. 85 00:06:19,950 --> 00:06:22,670 And you can see this is the third time it happened. 86 00:06:23,550 --> 00:06:25,030 So this is the fourth time. 87 00:06:25,290 --> 00:06:31,230 So this is what happened and this is what we have to consider while calculating the risk reward ratio. 88 00:06:31,500 --> 00:06:32,790 I hope you understood this. 89 00:06:32,970 --> 00:06:38,850 Let's move on now to the next candlestick pattern that is bullish piercing.