--- title: 'The Sector Strategy Most Traders Ignore' source: 'https://youtube.com/watch?v=uGtzJy7N-Z8' video_id: 'uGtzJy7N-Z8' date: 2026-07-24 duration_sec: 1858 channel: 'Prime Technical' --- # The Sector Strategy Most Traders Ignore > Source: [The Sector Strategy Most Traders Ignore](https://youtube.com/watch?v=uGtzJy7N-Z8) ## Summary This video presents a detailed sectoral trading strategy for F&O stocks, focusing on pre-market preparation, sector selection based on advances/declines, and three specific entry setups. The presenter, Kushal Varshney, emphasizes the importance of watchlists, risk management, and disciplined execution to achieve consistent intraday profits. ### Key Points - **Introduction to Sectoral Strategy** [00:02] — The strategy focuses exclusively on F&O stocks and requires pre-planning, including creating sector-wise watchlists. - **11 Sectors for Trading** [01:46] — The 11 sectors are Pharma, IT, Metal, Realty, Energy, FMCG, PSU Bank, Private Bank, Auto, Finance, and Defence. - **Morning Routine: 9:15-9:20** [03:35] — From 9:15 to 9:20, only observe the market; no decision-making. At 9:20, check advances/declines on NSE site or Novama for real-time data. - **Sector Selection Based on Advances/Declines** [05:45] — If advances are higher, trade upside sectors; if declines are higher, trade downside sectors. The top performing sector is chosen for the day. - **Three-Step Trading Plan** [08:57] — The plan consists of Selection (choose sector), Setup (identify entry pattern), and Action (execute trade). - **Setup 1: PDH Breakout with Two Green Candles** [10:19] — Requires a 5-minute candle close above previous day high (PDH), followed by another green candle. Overall move must not exceed 2.5%. The second candle's high-low range should be under 1% of stock price. - **Setup 2: Low Volume Pullback After Gap Up** [14:43] — Ignore first three candles after a gap up. Look for a red candle with the lowest volume (in counts) compared to previous candles. Enter on a buy above that candle's high, with stop loss at its low. - **Time Limit for Setup 2** [23:26] — Setup 2 should only be used until 11:00 AM, as the market tends to go sideways afterward, increasing stop losses. - **Risk Management: RPD and RPT** [25:45] — Risk Per Day (RPD) is 1% of capital. Risk Per Trade (RPT) is RPD divided by maximum number of trades (4). Never enter a stock more than twice. - **Focus on Risk, Not Quantity** [27:55] — Traders should focus on risk amount per trade, not quantity. With 1:2 risk-reward, even 30% accuracy can be profitable. ### Conclusion The sectoral strategy, combined with disciplined risk management and practice, can lead to consistent intraday profits. The presenter encourages viewers to practice with ₹100 risk for 100 trades to master the approach. ## Transcript and do you know where that move comes from ? From the sector i.e. sectoral strategy. So today we will discuss that strategy in detail. You you will not need to go to any other YouTube channel. Let's start with Let's start with sectoral strategy. Now look, first of all we understand one thing in this that in this we will work only and only in FAO stocks. work only and only in FAO stocks. We will work in these stocks only. Before this, there are some things which we will have to pre-plan in advance. That means we will have to keep it ready in advance, which I will show you. This is M Broker and look here I have created all these sectors. Ok? Like PSU Banks, Pharma, Metals and you can their stocks are appearing below. Right? Can you see this? Which stock is in which sector. So for all this you will have to first create a watch list like this. If you do not have this watchlist, you can create one in Trading View. you can create one in Trading View. in Trading View. If you don't want to use TradingView, the If you don't want to use TradingView, the secondary option is Nova. You can use Nova. You get it readymade there also. Ok? So before working on this strategy, you have to understand that we are going to work in FNS stocks. And the 11 sectors in which we are going to work. Let me show you their list once. So these are the 11 sectors Pharma, IT, Metal, Realty, Energy, FMCG, PSU Bank, Private Bank, Auto, Finance and Defence these are the 11 sectors in which we can work. Ok? Now it is necessary to have their watch list. Why is this important? Because guys, when we go to the market in real time, you must have execution, you get nervous. That means you do not remember which stock is in reality and which stock is in IT and this is normal, friend, this used to happen with me also. So what did I do to make it simple? If you look at this, I have I have added all this to my watch list. What are the stocks in PSU in reality? He was visible. What are the stocks in PSU? Which stocks are there in pharma? Now if you want its list then where will you get it ? For its list, you simply have to go to the NSC website. On the NSC website, you will click on Market Data Indices and here you will scroll down a bit and you will see Sectoral Indices. see Sectoral Indices. all the stocks of Auto will open here. But you have to check who is in FAO. Like if I look from here, I think probably all of these are in FAO. Accept Sons Sons I think is probably not in the NFO. So we will not keep this. What will you do with all the remaining stocks? You can add it here. Ok? So you should have this watch list. Only if you have this watch list, you will be able to take decisions quickly. Ok? So this is understood. You can check it in Trading View or you can check it in Novama. We have to work in these stocks only. Now how do I select stocks in this strategy? Okay, right? So let us understand this. So what am I to do? What time does the market open in the morning? 9:15. Okay, right? What do you have to do by 9:20? You just have to watch. No decision making is required. From 9:15 to 9:20. I am writing these steps for you at 9:20 so that it becomes easier for you. 9:20 Pay You Need to Check 9:20 Pay You Need to Check Advances checked? Because see, advances and declines tell you a sentiment. That is, what is the overall trend of the market ? If the advances are high, that means ? If the advances are high, that means what is the market? The market is bullish. If the decline is high then what is the market? It is bearish. We have to keep this thing in mind. So what time will we see Advances and Declines? Will see you at 9:20. Now people's question is where should they see this? What to where should they see this? What to look at in Nifty 50? look at in Nifty 50? Should it be in Nifty 50 or NPO? So the answer is in NFO. See. Where can I see it? You go to the NSC site. can I see it? You go to the NSC site. Simply go to the NSC site and if you click here, you will see Equity and Market. Ok? So here you can see Nifty 50. Scroll through it and select NFO. Securities and NFO will be visible at the last. And here you can see Securities and NFO will be visible at the last. And here you can see how many stocks are listed as wet are positive right now? How many stocks are negative right now? You have to check this at 9:20. This is not real time. If you see, it is 48 and if I refresh it, it will be 46, that is, there is a delay of 1 to 2 minutes. So what can you do about it ? For this, if you want to check it in real time then you can check the fires. Check it out at Novama. You will get it in real time. Ok? Now I have understood from here Ok? Now I have understood from here that if there are more advances then I have to go to the upside sector and if there are more declines then I have to go to the downside sector. Ok? But a question should come to your mind. What question? Sir, if the decline is high then ca But for that we need some multiple confirmations which we will discuss later. So, we will keep it easy for now and easy means that the advances are now bull, that is, the market sentiment is bull and you will go upside. The decline is high. There is bearish sentiment and we are going to select the downside sector. I understood this much. understood this much. Now let's assume that right now it's 9 21. Ok? We accept this. Let's assume. And let's assume now. So first of all what I will check is whether there are more advances or more declines. So from here I can see that there are more advances or declines. I'll refresh it once I'm back. There I'll refresh it once I'm back. There plan a trade in the upside sector. I will come here quickly. And see how much time it takes. From here I will shorten it. Ok? I shorted it again. Shorted the upside. So which is the top performing sector right now? That is a reality. That means I have understood in which sector I have to plan today? In the realty sector, and believe me, this is where the top gainers emerge. You will see how I have understood the reality now. This data that we are talking about right now, right now it is near about 2 pm but even in the morning, if I talk today, then only the realty sector was up. The second runner up was the auto sector and the top up. The second runner up was the auto sector and the top loser was that was a pharma. Ok? So the same can definitely go but for that some multiple confirmations are required. But we want to keep it simple right now, so we will plan the trade in the reality sector. So from here I got confirmation that brother, I have to work in the reality sector today at 9:21. I hope you all have understood this much. Ok? Well, now I know that I have to work in reality. Now the important thing is which stock to work in. Ok? So back to that, if you have a watch list, it's going to be easier. Otherwise do you know what is going to happen? Otherwise you are going to get confused. You are going to be confused about which stocks are in this particular sector. That's why I say that this watch list is the most important. Ok? So let us go to our watch list look here in the reality sector I will show you the stocks. DLF Lodha Obroy RIT FIX Prestige All these stocks are in our Realty sector which we have already added. Now I have to plan my trade in these. What should be our approach now? What ? Such a trading plan which we repeatedly say that brother, a trading plan is very important. What should that plan be? Ok? So what have we prepared for that? For that we have created a three step process. We understand that. Let's delete it once. If you don't have this , then I don't think anyone can be successful in trading. We have divided this trading plan into three parts. The first step is first step is selection. The second [nasal sound] step is setup and our third step is action. as to which one we are going to go to? Going to enter the real estate sector. We will now check which stock we are going to invest in and that will help us in our selection. Sorry about the setup. So, if we know the setup then we will check in all those stocks of the realty sector in which that setup formation has been formed. If that setup formation matches If that setup formation matches then we will take action i.e. execute the trade. Ok? So let's understand that setup. What is that setup? But the simpler you keep it, the better it is for a beginner or a good person. In my opinion, I know who is a beginner, every person is a beginner who is either making losses or has just either making losses or has just So look at the setup, we will keep it very simple. What do we have to do for this? You all must know what PDH is? That means previous day high. Ok? I made this PDH. And I made this a PDL. I made this a PDL. PDL Previos de lo. Some people PDL Previos de lo. Some people also call it yesterday high and yesterday low. Ok? Right? What do we do now? The time frame that we are going to use in this, our time frame is going to be Ok? So what do I want? I want a 5 minute candle close above a PDH. That is, a 5 minute candle closes above the previous day high and another green 5 minute candle closes above the previous day high and another green candle formation is formed. Right? Back to back. And the momentum in both of these should be maximum, that is, the overall move of both these candles should not be more than 2% maximum. That means if the gap opens at 3%, 4% or 5%, then in such a situation I will not use this setup. And I'm naming this setup setup number one. Ok? So we're going to learn at least three setups here. learn at least three setups here. in this video. So what happened to setup one ? That this is the first candle. The second candle should also be green. It should be of the same color. And what will I do from here? I will plan a buy and place a low stop loss for this candle. Now in this I have told some conditions as to what should be the overall move? 2% Now look, some people ask, Sir, if it was 2.1 then what should we do? people ask, Sir, if it was 2.1 then what should we do? Friend, do plus or minus half of 1% i.e. 2.5. Not more than this. Now I am giving this candle a name. I am naming this candle Master. Why? Because brother, this is the reason why I am planning to say goodbye. And the name I am giving this candle is That Is a name I am giving this candle is That Is a Confirmation. I am buying this candle. I am placing a low stop loss for this. So this candle is very important to me. Right? Now what I have to check in this is that the size of this candle, the difference between high and low, should not be more than 1% of the value of this stock. Do you know the reason why? Because the bigger the size of the candle, the lesser is the probability of getting risk reward. The smaller the size, the better the probability of getting risk reward. So this should be small. If it is more than 1% then do n't do it at all. I will not do it at all. Ok? So did you understand this setup formation? This is for bye. If you have chosen the upside sector. If your upside sector has come in the selection then you will use this setup. This setup will be checked in those stocks which belong to that particular sector. What should be done if the downside sector is chosen ? For the downside, you need a close below the PDL and another candle to be red. We will plan a sell below this candle another candle to be red. We will plan a sell below this candle and the high SL of this candle will be there. Ok? I hope it is clear to all of you. Time frame 5 minutes. Below this, sell its high stop loss and the overall move of both of these is loss and the overall move of both of these is maximum 2.5 not more than that right and the maximum 2.5 not more than that right and the size of this candle, the difference between high and low, size of this candle, the difference between high and low, that should not be more than 1% of the stock value, what people do about the value of the stock, they calculate it from here, they check it close to close, no, I am checking the high and low because this is my risk, so whether I will get more reward or not, this candle is going to tell me that. not, this candle is going to tell me that. This candle is going to decide. I hope you understand this setup. So we made the selection. This is a setup we learned. Let's take a setup and learn. Ok ? So your execution will become easier when I move ahead now. Right? Now what does this setup two say? This setup is very simple. I have told this many times in many videos. But let's quickly recap it once again. What do I need to do with the first three candles? Have to ignore it. And where do I need this? Day high i.e. above PDH. Above PDH. I have to ignore three candles. And after that, why did I introduce this setup here ? In setup one, there was a condition that BH should not exceed 2% or 2.5%. There is no such condition in this setup. There is no condition for any gap up. There can be what should you do in that case? Ignore all three candles – first, second and third. After that you need a candle of opposite color. A candle of opposite color comes and the most important thing here is your volume. Ok? And here the volume that I need is in counts, that is, the volume is created outside like this below. need. Where was the world busy till now? There is only high volume. We at Prime Technical just introduced you to this low volume that performs very well. occurs after ignoring three candles, then what simple thing do you have to do? Buy has to be placed on this candle simple thing do you have to do? Buy has to be placed on this candle what happens inside it many times? The insides come out. Many times an inside like this comes in, it doesn't matter. come out. Many times an inside like this comes in, it doesn't matter. can ignore the inside candles. You have to buy on this. But if the volume inside reduces and it is red. Okay, right? If it is red and it reduces then you can buy from inside also. I hope you guys understood. Right? You must have understood this thing. So now we will see this same setup in our realty sector today because the realty sector was up the most and even now if we see, it is up approximately by 4.5%. Ok? So let's quickly move on to the charts. Now look at the first candle, if I look here, what is the first candle? It is red. That means I will not get entry. Isn't it ? Reality sector is the first candle red so far so I won't get entry. A set of one is not possible. But what setup is created here? If the forest is not formed then what do I have to look for? Have to go for two. Let's check. Ignored the first three candles. 1 2 3 And here we also keep an eye on the volumes. The volume that has come in the third candle, the volume that has come in the third candle, the this candle came opposite. What is the volume here now ? ₹176000 which is not the lowest. Let's check on this candle. How much volume is there? 143000 is the lowest. Let's check on the next candle. 148000 is not the lowest. So what was this on the candle? It was the lowest volume. So what did you have to do ? I simply had to make a long plan on this candle. And the low of this candle was going to be your stop loss. And from here if you plan a trade then look now I think maybe it is 1:2 one at 607. I believe that if you are trading, if you are in trading then there is no such thing as 1 1. 1 1 Nothing people start flying planes as soon as ₹1 ₹2 move. For me, successful trade means minimum 1:2, that is, that much is required. And because do you know what intraday trading means minimizing the risk. That means this pan is looking at that there should be this much risk. So small and we will make the reward as big as we can. Ok? So 1:2 risk Ok? So 1:2 risk reward minimum that is a successful trade. Let's come back to the charts. So from here I see that there is 1 at 67 which has see that there is 1 at 67 which has no meaning. 1 2 is 610. So let's no meaning. 1 2 is 610. So let's put a line on 610. This is your 1:2 that happened here. And from there you keep adding ₹3. So I think probably around 1 six would have been achieved because 619 is running right now and from here I came three times and added ₹3 to get ₹9, so we have got approximately 1 five in this trade right now. Right, and what setup did I Right, and what setup did I use here? Low volume setup number two. Ok? Now some people will ask, Sir, this was also a red candle and the volumes here are big. Now look what is here? It was low volume. Now I generally ignore the insides. There is no difference. But the next candle is ready. Okay, right? And I am also watching the price action there, it has happened only for the upside. And did not even close it below. So many times we can plan by doing a little formatting. If you don't, then you'll have to look here. And if you look here also, it is 42,000, should I get it checked here also? You can check back to back from here, this one You can check back to back from here, this one was the lowest, 65,000, this candle has the lowest was the lowest, 65,000, this candle has the lowest volume. The lowest is 42,900, volume. The lowest is 42,900, that is, from here a question might have come to the mind of some of you that why from here? From here I looked at the price action and it was okay. Planned it. But actually, if you okay. Planned it. But actually, if you get better risk reward. Why? Because how much risk was there here? Of ₹1.30. And what was the risk here? Of ₹3. That means there was double risk here. This has reduced further. That means it is the best. So more risk reward. Do you understand? Let's reward. Do you understand? Let's look at the next stock. After DLF, Lodha. Ok ? Let's analyze the chart of Lodha. So what was to be done? There is nothing to be done because 2% 2.5% was supposed to be the maximum. So let's check setup to. 1 2 3 What is the lowest volume? 30 30000 Now check What is the lowest volume? 30 30000 Now check how much did you get in this raid? 22 Now 22 will buy on this. Another red candle even lower above it will buy. After that the even lower above it will buy. After that the volumes increased. 17,000 is the lowest volume you will see in this candle and it is red. That means you had to plan your purchase based on this. means you had to plan your purchase based on this. Its low stop loss is 1:3 Its low stop loss is 1:3 at 934.5 which I think has almost been achieved. at 934.5 which I think has almost been achieved. Maybe he has made it 1:45 instead of 1:3 because the risk was ₹3.5 and the high was ₹924 and in actual he has placed the high ₹ was ₹924 and in actual he has placed the high ₹ 92942.95, and 20/3.5, you can calculate and tell me how much risk reward has been received in this stock. Next let's check the stock. So, look, you are trading this also, you have got trade in DLF also. Also found in Lodha. I will check the overall reality in this also. We did not find any trade in this. Why? You are looking at the first candle. I was in the top gainer, it was 2.7 so I don't have to do it. I will check the low volume from here. will check the low volume from here. Look at the lowest volume here, it is 736, after this it gives a candle but the volumes have increased so the date plan will not be there, after that let us see here 2459 I 2459 I think maybe this is also perfect 2009 think maybe this is also perfect 2009 74 and here at 200459, so trade 74 and here at 200459, so trade is available here and from here there is a target in it also. There are many super targets in this also. Next Phoenix, this is awesome. You look at the first two candles, you have to check setup one in the first two candles. If it is 2.9% then don't watch it. Will low volume see? Check from here what is the volume of the opposite color? How much was 3983 here? 5000 5000 This is 3983 3956 perfect. Plan on this candle. If it is running inside then it is best. Start planning from here. Do not go from here above this candle and check where low volume has come. After this, look where low volume has come. After this, look here, there was a let me check once again 4000, there is 3000 is 3000 2000 in it, so I think this one 3000 is the perfect one. From here, go above the high of this. So wherever it is visible. Well, there are limitations to this low volume. So the maximum time of use of this setup is maximum up to 11 clocks, do not use it more than this. Generally we used to do it at 10:30 earlier. Then from 10:30 we extended it till 11 o'clock. But after this you should not do it at all because what happens? Then the market goes sideways. And when it goes sideways, it directly impacts the results. You will start getting frequent stop losses. So Max 10:30 earlier I suggested 10 ah sorry suggested till 10:30. Then gradually extend it till 11:00. But do till 11:00. But do n't go beyond 11:00 at all. Ok? Well, we got a trade here too. This has also performed very well. Let's also check Prestige Prestige. Let's not use the first candle 2.7 setup one. Three candles were ignored. Let's check again. Low volume here is not low but high. What was the lowest? 5129 Let's check this. 5456 5325 Not found. Let's check here. It increased here too. 49 39 I think I'll have to check back once. 39 I think I'll have to check back once. Where was the lowest? Till now it was So this is also not found. Then somewhere here you get it for 1045 I think 3000. somewhere here you get it for 1045 I think 3000. Ok? And how much was in it? 3100 we have not got the trade in Prestige. It is not found in setup one and it is not found in setup two also. Doesn't matter, it's okay, this is also going well. But don't worry there are more setups. If you want to learn more, please let me know by commenting. Ok? And if you want to learn advanced setup then you can get entry from there. So tell me by commenting whether you are enjoying it or not. Ok? So look from setup two, look from one, entry is not found in it. But in all the remaining stocks you got perfect entry and perfect you got perfect entry and perfect results. Right? So the same strategy has to be executed in the same manner. Then see how the results come. Now there is a third step left. Let's talk about this. What do many people do? Just frequent trading free means whatever gives it is fine. Saw FNO, did FNO. He will give cash, I have taken cash. I did whatever I wanted. No, risk management No, risk management is very important. Here we have done it with automation, from here you will see that if I place a charge on any candle then here I can see how much quantity I have to take. That means I have told the system that I want to take a risk of Rs 1000 on this particular candle. So he told me that the SL is of ₹3 and you have to buy 333 quantity. So when I follow this, I get the best results. So the first part of risk management is RPD i.e. what should be the risk per day? RPD i.e. what should be the risk per day? 1% of your capital. It should not be more than this. 1% off capital. Next is how much should the RP T risk per trade be? That depends on the number of trades. If you are working on a sectoral strategy , number of trades. If you are working on a sectoral strategy , what is the maximum number of trades ? Four. Do not do more than four trades. And never enter a stock more than twice. not do more than four trades. And never enter a stock more than twice. , let's suppose my capital is 1 lakh. So what is the maximum risk? So what is the maximum risk? How much is the RPD? 1% that is 1000 How much is the RPD? 1% that is 1000 and how much is RPT? 1000 / and how much is RPT? 1000 / 4 that equals 250, so I have to tell the system. 4 that equals 250, so I have to tell the system. Like I told the system that brother I want to take a risk of Rs 1000 and the system told me that if stop loss is placed at 333 quantity then there will be some slip. It's okay, it will work. But 1000 cannot become 2000 or 3000. So we always have to keep this thing in mind and people often make this mistake. Whenever I felt like it, I took whatever quantity I wanted. I had a small stock and increased the quantity. There is a huge stock, the quantity has been reduced. You need to focus on risk when trading, not quantity. If you follow this system, then believe me, even if you get 30% accuracy, you will still make money from this system. Because its risk reward is 1:2 unlimited. Ok? And personally what I have achieved till now is 1:53. I am trying to achieve. Now I am trying to break this record. Let's see when the break will be. I will definitely let you know when I have a break. I achieved this in Adani Enterprises. And let me tell you one more thing. in Adani Enterprises. And let me tell you one more thing. These 1 10 and 1 and 120 are very frequent. Today itself we have achieved 114 in Pharma. Ok? The downside sector was pharma. So as I said, you could have gone down side also. But for that we need some multiple confirmations. So I won't complicate it further now. I will keep it easy here. Ok? There we chose Aur Pharma. Let me show you the chart of Auro Pharma. Look at this. This is the Oro Pharma Chart 1s2 14 already we have achieved. I will make it a little smaller and show it to you completely. Look, even now 14 back to back matches have already taken place here. I don't know how much more it would have taken right now. Okay, right? I think it will reach around 20. how much more it would have taken right now. Okay, right? I think it will reach around 20. So this is the power in our selection. This is the power in our set setup. Now people must be wondering, is this possible? Is this in videos because everyone says that they should make videos. Come and do it live and show it live. Bhaiya Prime Technical is such an institute which shows everything in real time and not live. If you have not joined our Telegram channel then please join it. Real time market updates are available there. Right? So I used the same strategy, there is a slight difference only in the setups. We achieved more in pharma. So the same request is from you people that by using setup one, setup two in the same way, you can make your trading journey successful by using the same method, sectoral method. So practice. I am giving you the practice. Also understand how to practice. giving you the practice. Also understand how to practice. What do you have to do? You just have to take a risk of ₹100. I want to take a risk of ₹100. Ok? How many more trades to make? At least 100 trades have to be made. Believe me, this step is the most important. If you complete these steps, no one can stop you from becoming a trader. After completing these steps, please comment and tell us what changes have come in your life. Ok? So today's video will end here. But let me tell you one more thing and if you want to understand the detailed analysis and Sunday, its link will be available in the description. Subscribe to the YouTube channel. Join Telegram for live updates. Ok? Hail India.