Apurv,
Here we go. I will explain one case to you. After that, you apply this to the second one. Then you can post it here and get it verified.
Clutch Auto:
Your Analysis:
On 13th As you said it formed a Long Candle. Then on 14th and 15th it formed 2 black candles plus the RSI part you mentioned. Hence as you said, you squared off your position to buy it later.
Where you went wrong:
Look at the big picture first. Now I am going to reply in point terms. Look at the chart while reading it.
1. Look where I have written point 1. I have marked it at a long white candle which was the swing high in mid June. Now, lets come back to the 13th July candle. What has this candle actually done? It has
surpassed the previous swing high made almost 20 days back. This entire thing happened in one session. This in itself is a very bullish sign. If ever you would have entertained thoughts of selling, it would only be below the previous swing high. That is, below 70.
2. Now see where I have written 2. I have circled it at a place where you sold because of black candle piercing. In my honest opinion, that is not a piercing pattern. The black candle started above the 13th July candle, but did not penetrate enough to be verified as a piercing trade. Please remember, piercing pattern is valid only when the black candle, starts above a previous bullish candle and penetrates deep into the white candle (closes atleast below the half of white candle).
3. I haven't marked the point 3rd on the chart. THis is because this is more of a concept. Usually when you have a long white candle, the middle part of it becomes strong support. Till the price does not penetrate the mid point of the long candle, do not entertain any thoughts to sell.
4. Make use of moving averages for trend determination. Not for trading decisions. Think about this.
Does market care which moving average you look at??
What you should actually do:
1. Always look at the intermediate swing high support
2. When using candlesticks, be sure to apply the concept properly. Everyone struggles, even I did, but once you understand what works and what does not, things are going to be much easier.
3. Always and always look at bigger picture before deciding to buy or sell.
4.
Most important, define what you want to do with the stock first. In my opinion, clutch auto should not be sold. It is a buy on dip stock as of now.
Hope this helps.
Tc