Nooresh Merani is an IT engineer by qualification and Advisor/Trainer by profession. He regularly appears as guest analyst on CNBC, ET Now, Bloomberg etc. Read more here - www.nooreshtech.co.in/about Twitter @nooreshtech
Buying on RSI Positive Divergences can be a tricky trade as one is going against the trend and only the momentum has stalled during a positive divergence. Also when the trade does not work out there could be a gap down and can give a much bigger loss than expected. For that reason most prefer to wait for a price confirmation through candlestick formations.
Another way to take this trade is to focus only on Indices where the gap down risks is relatively lower as indices are derived from a bunch of stocks.
This is the setup we are looking out for
The zoomed in chart for 2013 bottom
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