Patterns
Understanding Swing Setups
Swing setups are chart patterns and price-action conditions that JaySense identifies as
potentially significant for short-to-medium term research (typically 3–10 trading days).
Understanding what these setups mean — and their limitations — helps you use them responsibly.
What is a swing setup?
A swing setup is a specific combination of price structure, volume behaviour, and indicator alignment
that historically precedes a period of directional movement. JaySense does not predict the direction
or magnitude of the move — it identifies that a setup condition exists.
Swing setups are one input into the JayScore — they do not independently constitute a research signal.
A high-scoring stock with a swing setup is more noteworthy than a low-scoring stock with the same setup.
Breakout stages JaySense looks for
1
Accumulation / Base formation
Price consolidates in a narrow range after a prior uptrend. Volume contracts as sellers exhaust.
This is the foundation of a potential breakout. JaySense tracks the duration and tightness of the base.
2
Volume surge with breakout
Price moves above a key resistance level (often the base's upper boundary or a 52-week high) on
volume significantly above its 20-day average. Volume confirmation is a critical requirement — breakouts
on thin volume score lower.
3
Momentum confirmation
RSI crosses above 60, MACD turns positive, and the stock closes above its 50-day moving average.
When multiple momentum indicators align simultaneously, the setup score increases.
4
Continuation or re-test
After the initial breakout, the stock either continues higher or pulls back to test the breakout
level. A successful retest on declining volume is often a stronger setup than the initial breakout.
JaySense tracks both patterns.
ORB — Opening Range Breakout
JaySense also identifies the Opening Range Breakout (ORB) setup in its Morning Research Plan. The ORB
is the price range formed in the first 15 minutes of the trading session (9:15–9:30 AM IST). A stock
that breaks above the ORB high on volume is flagged as an ORB candidate for same-day research.
ORB setups are intraday in nature and are separate from the JayScore, which is computed overnight from
end-of-day data.
Limitations
- Past swing setup patterns do not guarantee future performance.
- Setups can fail — especially in weak market conditions or on news events.
- JaySense does not set stop-loss or target levels — those decisions belong to the investor.
- Intraday liquidity and bid-ask spread (especially in smaller Nifty stocks) affect execution.
JaySense is a research tool only. Investments carry risk.
Full SEBI disclaimer →