About Darvas :
In the late 1950s, Nicolas Darvas was one half of the highest paid dance team in show business.
Darvas turned a $36,000 investment into more than $2.25 million in a three-year period.
1/n
It was on a two-year tour of the world that he initially developed his ‘Darvas Box’ method of screening stocks – a method of picking stocks based on the stock’s price and volume .
Trading Style :
TREND FOLLOWING MOMENTUM TRADING
📌Darvas was tracking stocks only making new high
Trading stocks breaking 2-3 year high.
📌But 52-week high is mostly tracked for this theory
📌Emphasized very much on Huge volume Breakouts
A typical Darvas Box Chart : 3/n
Rules to Follow :
Stock Price Should be within 15 to 20 % of Highs
Overall trend of the stocks should be up and greater than 200 ema
Preferably 100% up then the 52 week low
Look for Industry Leaders , with High Growth
4/n
How to Trade ?
📌Whenever the stocks breaks the 52 week Keep them on watchlist
📌Look that The next 3 candles should not break the 52 week high and fall below
📌The high point will be called as CEILING
📌Look for Volume Breakout too or Breakout should be Above Average volume 5/n
Floor: Stoploss
📌Floor is basically the a small reversal point or bottom the stock is trying to make.
📌Floor is generally the stoploss of the trade
📌The bigger the range the bigger the stoploss and higher the Risk 6/n
Example : #GREENPANEL
After 52 week High , mark the Top: Ceiling
After a small Reversal mark the Bottom : Floor
Enter As soon as the 52 week high breaks with stoploss 7/n
#RADICO#MANINFRA
✅Enter When 52 Week High is Broken , and Keep Adding as and when the box formation takes place .
🛑Keep Shifting the stoploss to next Box lows 8/n
PIC 1:
Entry on failed Breakout but Stops Dont hit as Stoploss is below the Box
PIC 2 : You should only draw boxes when the next 3 candles of 52 week high dont break the high.
9/n
Parameters checked : #MINDAIND #kotakbank : Not valid Box , as stock is not breaking the 52 week high only the range breakout is happening
Also Restrict yourself to growth stocks that is midcaps and smallcaps 10/n
Time and % Differece of boxes :
There isnt any fixed % of difference from ceiling to floor mentioned any where
There also isnt any time frame mentioned how much the sideways trend or box formatiom will take place
There could be any combinations of boxes and there sizes 11/n
Short Ranges : IRCTC
Long Consolidation : BIRLASOFT
Short Range , Short Time : JINDWORLD 12/n
Trailing Stop and Pyramiding 1. Buy if price closes above Ceiling and put a stop-loss below Floor price. 2. Add Small Qtys as breakout happens and one can pyramid in winners and further breakouts 3. Ride the winner till you get Stopped 4. Reenter if stock regains 52 wk high 13/
3. After the breakout of the box, if price moves higher and forms another box, then trail stop-loss to the Floor price of the newly formed box and keep trailing on each subsequent floor.
4.Exit the trade when price goes below the floor price of the recent box. @AmitabhJha3
14/n
STOCK FUNDAMENTALS
Buy companies whose growth & earnings prospects look highly promising
Overall Market trend should be bullish
Stocks should be outperforming the general Market and should be leader
Breakout should be always on higher volume
Prefer Midcaps and Smallcaps
15/n
A thread to pick stocks moving 20-30% in a week🧵
( Chartink link at the end of tweet )
Technical Criteria 1. Stock near 5% of 52 week high 2. Stock above 30 weekly ema : Stage 1 uptrend 3. 21ema > 50ema signifying strong uptrend
You can also add Volume criteria
I made A few Lakhs using this Famous Swing Trading Strategy
A thread
Retweet for PDF
It is characterized by a period of price volatility followed by a contraction phase, leading to a breakout in the stock's price. Here's a breakdown of the VCP pattern:
Breakout Rules :
Buy Stocks on Break , not after breakout
Use Alert Systems or place GTT orders near Breakout area
If you miss the breakout better to stay away from stock as RR goes out of favour
It took me 3 years to understand Volume Price Analysis
I'll explain in next 10 tweets
A thread🧵
RT for max Support
Support Resistance
✅They simply represent the 'extreme' psychological levels of fear and greed in that particular price region and time.
✅Strength of Buyers = Sellers
✅Lower volatility price congestions
7 less known Tradingview Indicators that all traders should know about
A thread🧵
1. @TraderLion_ Enhanced Volume Indicator
Lime Green Bars Suggests day when the stocks closes near the days high and volume greater than past 10 down volume days Suggesting Institutional Accumulation
Has Features Like :Highest/Lowest Volume in a year.
Modified version of Bollinger Bands
When price is written in blue, volatility overall is falling. When the outer bands start to fatten up in blue, a contraction signal is forming. Works with any length of your choosing