CHOLAFIN – Cup & Handle Breakout | Target ₹2120 (28% Upside)

Jun 27

CHOLAMANDALAM FIN has confirmed a classic Cup and Handle breakout after 9 months of base formation. The neckline at ₹1645.85 has been cleanly crossed with strong follow-through and high volume.

Pattern Structure:
Cup Base: Formed between Sep–Dec 2024, bottomed near ₹1170
Handle: Shallow, corrective structure in May 2025 — ideal proportion
Breakout Zone: ₹1645.85 (horizontal resistance since Sep 2023)
Breakout Candle: Strong close at ₹1654.10 with high conviction volume (5.84M vs 2.3M avg)

Trade Setup:
Entry: Confirmed on breakout close above ₹1645
Target: ₹1645.85 + ₹472.85 = ₹2120
Stop Loss: ₹1545 (below handle low)
Risk-Reward: ~1:2.5 for positional traders

Indicators:
Volume: Significant spike, validating breakout
RSI: 60.2 and rising — bullish, not overbought
Moving Averages: Price well above 20 SMA, momentum aligned

Bias & Strategy:
Structure favours long-only positioning. Ideal for trend followers. Breakout is supported by volume and proper consolidation. Short-term pullbacks toward ₹1645–₹1620 can offer re-entry. Avoid shorting — this is the start of a fresh leg higher.

Disclaimer:
This analysis is shared strictly for educational and informational purposes. It does not constitute investment advice, nor is it a recommendation to buy, sell, or hold any securities. You are advised to perform their own due diligence, assess risk tolerance, and consult a registered financial advisor before making any investment decisions.

Jul 3

Trade closed: stop reached

The anticipated Cup & Handle breakout above ₹1645.85 has failed. Price has decisively broken down back into the handle zone, now trading ~7% below breakout level. Volume on the decline has picked up, confirming distribution. RSI slipping below 45 adds to bearish momentum.

Preserve capital and re-evaluate on retest or new structure