Trading KST indicator with Keltner Channel Breakout on Nifty

bank nifty keltner channel kst nifty Dec 07, 2023

Trading KST indicator with Keltner Channel Breakout on Nifty

and Bank Nifty touched lifetime high levels where Nifty is at a kissing distance from 21k mark.

Using momentum indicators along with breakout techniques that can help in capturing the entire up move is important.

Nifty 15 minutes chart:

In above chart of Nifty we can see two important indicators that are focused on prices and momentum.

Keltner channel – This indicator is different than that of Bollinger Bands®. Bollinger Bands uses standard deviation to the mean whereas Keltner channel is derived using Average True Range (ATR). Both of the indicators have different way of application.

In Keltner channel we can see that break above 19810 on 28th November was the 1st break above the upper band of Keltner.

KST momentum – Breakout on Keltner channel was also accompanied by KST momentum indicator. KST momentum indicator broke above 0 line and also the signal line thereby giving strong confirmation that momentum is picking on upside.

In entire up move prices have not moved below the lower Keltner channel and KST is now back to the 0 support area. This can be a pause before the resumption of trend but a classic signal can be expected when both these techniques again get synchronized.

In a nutshell, Keltner channel helps to understand if the size of candle is increasing which is suggesting a significant move and KST further provides confirmation of momentum. Price action above 20970 will result into another synchronous signal from these indicators.

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