Title: Intraday Price Action Strategy – Inside Bar with Volume Confirmation
Introduction
Intraday trading means buying and selling a stock within the same trading day. It is fast-paced and requires precise timing, quick decisions, and a solid trading strategy. One of the most effective ways to trade intraday is by using price action, which means making decisions based on price movement rather than relying on indicators alone.
One powerful price action setup is the Inside Bar. When combined with volume confirmation, it can become a reliable and high-probability intraday strategy. In this blog, we’ll learn everything about this strategy in simple language and show you how to use it step by step.
What is an Inside Bar?
An Inside Bar is a candlestick pattern where the current candle is completely inside the range (high to low) of the previous candle. This shows consolidation or indecision in the market. Traders use it to spot a potential breakout.
Characteristics:
- The high of the inside bar is lower than the high of the previous bar.
- The low of the inside bar is higher than the low of the previous bar.
It looks like a candle “hiding” inside the previous candle.
Why Volume Confirmation?
Volume shows the strength behind price movement. When price breaks out from an Inside Bar with high volume, it shows the move is backed by real buying or selling interest. This helps reduce false breakouts.
When to Use This Strategy?
- During the first 2 hours of market opening
- In liquid stocks (high volume)
- When the market is not choppy
Tools Required
- Candlestick Chart (5-min or 15-min timeframe)
- Volume indicator (default TradingView volume)
- Support/Resistance zones (manually marked)
Step-by-Step Intraday Strategy
Step 1: Stock Selection
Choose stocks with:
- Price between ₹1,000 to ₹2,000
- High volume
- Recent momentum or trending moves
You can use a scanner or manually pick from top gainers/losers.
Step 2: Mark Key Levels
On the 15-min chart, draw:
- Previous day’s High and Low
- Major support and resistance zones
- Any visible trendline
These will help filter valid setups.
Step 3: Identify Inside Bar Formation
- Switch to 5-min or 15-min chart.
- Look for an Inside Bar near key levels.
- Ensure the Inside Bar is small and narrow (tight range).
Step 4: Volume Confirmation
- Wait for a breakout candle (break above or below the mother candle).
- Volume should be higher than the average of last 10 bars.
✅ If volume is high → good confirmation
❌ If volume is low → ignore breakout
Step 5: Entry Rules
- For long trade: Enter above the high of mother bar if breakout happens with volume
- For short trade: Enter below the low of mother bar with volume confirmation
Use limit or market order based on your broker.
Step 6: Stop Loss Placement
- For long trades: Stop loss below the low of the Inside Bar
- For short trades: Stop loss above the high of the Inside Bar
Step 7: Target Rules
Option 1: Fixed Target
- 1:2 Risk to Reward Ratio
Option 2: Trailing Exit
- Trail below higher low for longs
- Trail above lower high for shorts
Step 8: Exit Rules
- Exit full position at target
- Or partial exit at 1:1 RR and rest trail with SL
- Close all open positions by 3:15 PM
Chart Example (Use real charts when posting)
- Show image with Inside Bar near support
- Mark breakout with volume spike
- Highlight entry and exit
When to Avoid This Strategy
- During sideways or low-volume market
- During major news events
- On stocks with wide spread or low liquidity
Bonus Tips
- Use the 15-min timeframe for better accuracy
- Avoid taking trades if the breakout candle is too big
- Backtest before going live
- Trade only 1 or 2 setups a day
Psychology Behind the Setup
The Inside Bar reflects a “pause” in the market. Smart money often accumulates during these pauses. When breakout happens on high volume, it signals that smart money has made its move. This is what we want to catch.
Risk Management
- Never risk more than 1% of your capital per trade
- Set alerts for key levels to avoid emotional entries
- Use journal to track your performance
Sample Trade Journal Entry
| Date | Stock | Direction | Entry | SL | Target | Volume Spike | RR | Outcome |
|---|---|---|---|---|---|---|---|---|
| 01-Aug | ABC Ltd | Long | 1480 | 1465 | 1510 | Yes | 1:2 | Target Hit |
Summary Checklist
- Chosen liquid stock
- Inside Bar spotted near key level
- Breakout with volume confirmation
- Risk-Reward favorable (min 1:2)
- Trade executed with SL and target
Final Words
Inside Bar with Volume Confirmation is one of the simplest yet effective strategies if traded with discipline. Always focus on quality over quantity. One or two good trades a day are better than chasing every move. Combine this with strong money management and your trading journey can become more consistent.
Disclaimer: This strategy is shared for educational purposes only. It is not a stock recommendation. Always do your own research before trading.
If you found this helpful, don’t forget to explore more price action setups and weekly chart updates on our site!