What is a Darvas Box

English · 2:31 · Published 2026-10-28

How boxes form near new highs, breakouts at the top edge and the staircase of stops.

What the video says

In the nineteen fifties, a professional dancer named Nicolas Darvas turned a small account into millions. He traded from hotel rooms around the world, using one simple idea: the box.

Darvas believed strong stocks move in a series of boxes, one stacked above the other, like stairs going up.

It starts when a stock makes a new high, then stops. If it cannot go higher for three days, that high becomes the top of the box.

Then the stock pulls back and finds a low. If that low holds for three days, it becomes the bottom of the box.

Now the box is set. As long as the price stays inside, Darvas did nothing. He just waited.

When the price breaks above the top of the box, that is the breakout. Darvas bought here, with rising volume as confirmation.

After the breakout, the stock makes a new high, pauses, and a new box forms, a little higher than the last one.

Box after box, the staircase climbs. And each time a new box forms, Darvas moved his stop up to the bottom of that box.

This is the beauty of the method. You never guess the top. The boxes tell you when the trend is over.

When the price closes below the bottom of the box, the staircase is broken. That is the exit.

Here is what it looks like on a real Market Strength chart, with the Darvas indicator switched on.

Each teal box shows a top that held, and a bottom that held. Breakouts happen at the top edge.

A few things make a box stronger. The box should form near the fifty two week high. A tight box is better than a wide one. And the breakout should come with volume.

On Market Strength, Popular Scans has a Darvas scan. It lists stocks breaking out of a box, and stocks still inside one, with the box top and bottom.

You can also add Darvas boxes to any chart from the Indicators menu.

Market Strength is an education and research tool, not investment advice.

Read the guide: Darvas box scanner for NSE stocks

More videos

All video lessons