Both correction have taken Bow-Tie diametric form(7 leg pattern,Expansion in first 3 leg and compression in last 3 leg).
Right now it seems like second correction is done and current fall can be wave X or wave 1(star of new impulse on the downside)
Shown horizontal dashed lines are retracement(23,38,50,62) levels of second correction.
Notice through out this up move price has taken support of lower channel which it seems like will be broken in current fall.If price goes below 475 and gives closing below it in next 2 day's it will give 2 stage confirmation of TL breach and faster retracement of previous swing meaning bigger move on the downside can come in near future.
Personally i feel metals are way to over stretched on the upside and it's time for them to move down.I have posted charts of Sail and have shared link of my analysis on tata steel on this platform and both charts are showing sign of weakness.
Hindalco being an aluminium and copper producing company has shown divergence from steel producing stock in metal sector up until now,but since last three days it has aligned itself with the broader markets and on the charts it seems like completion of double correction as well.
We can also see that price is following 18-days cycle and price has reversed around cycle low zone on 11-12 occasion.And the next cycle low period is coming on 27-10-21,hence bounce can be seen in price around that day and one should look to exit longs or build short position around that time.
Trade setup criteria
1)Prices needs to close below 475 in next 2 day's. 2)If 1st criteria is meet,then one should look to short the stock on bounce till 495-500(broken channel then act as Resistance). 3)If We should get a reversal candle in the form of shooting star,bearish pearcing,bearish engulfing around channel levels then one can initiate short trade on the next day when the low's of the reversal candle get's taken out.
stop-loss would be 530 on the upside and expected targets would be 475-425-389-360 on the downside.Time frame for this trade would be minimum 1 month.
DISCLAIMER:There is no guarantee of profits or no exceptions from losses. The study provided is solely the personal views of my research. You are advised to rely on your judgment while investing/Trading decisions. Past performance is not an indicator of future returns. Investment is subject to market risks. Seek help of your financial advisors before investing/trading.
I may or may not trade this analysis
Comment
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we have got faster retracement of prior swing in today's trading session,meaning on 8th october price closed @ 473.65 and from there on it took 5 candles to reach @ 551 high.Today we have closed @ 470.45 and entire fall took only 4 days to breach previous swing low,this clearly indicates change in momentum.If on Monday we get a pull back between 495-500 then one should wait for an hourly candle giving close below the low's of pullback's highest high candle.This would be our trigger for short sell trade.
Nice analysis.Let me know current posiotion. results are good. already i am in short @ 460.5.Due to good results it shoot up.. what is the next week view .please help
UNDERDOG-29
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@sureshkumarnew, See I cant tell you exactly how it will behave as i dont know your risk apetite and time frame that you are trading for but here's my view for next week.
Logic for stock to fall from current levels. 1)Check the Bhav copy of this stock on nse,call writers are increasing at 460,470,480,490,500 levels meaning upside is limited and stock will face good rasistance at every 10 rs up move. 2)On the Put side OI is shifting to lower strike price and has max OI at 450 levels,which is 4% down from current price,also if you look at the Put side there's been unwinding going on at 470,480,490,500 strike prices indicating weakness. 3)Stock is trading in 21 day time cycle since 21-06-2021 low of 380, meaning after every 21 days it makes significant low and then rally's,as of now this time cycle low is due on 23-11-2021 supporting bearish view.Also since last cycle low,stock has gone down instead of going up after time cycle low low period,meaning there's an inversion happening. 4)It has broken major upward slopping channel support.
Logic for stock to move higher from current levels.
1)Strong bullish candle on daily chart in yesterday's trading session closing at it's high. 2)72 ema is at 460 levels indicating support. 3)Stock's correlation with Nifty movement.
Logic for stock to remain side-way's. 1)On weekly chart it has not closed above it's prior candle high and on daily it has so daily trend is not aligning with weekly.
Personally i feel inspite of good result's stock will correct as there's significant OI at higher levels and also stock has strong rasistance at 482 levels,hence you can keep 482 as your stop-loss levels and see if stock stay's above 482 for 1 hour,and on hourly chart you see a strong closing above 482 then exit as then stock can go up till 500 levels,where as on the down side 460 seems to be good support as of now it we breach's 460 and stay below it for 1 hour and we get bearish candle on hourly chart below 460 then keep riding the trend until you get hourly candle closing above previous candle's high. Hope you have got your answer that you were looking for,dont trade on my analysis apply your logic and see if it align's with mine or not and act accordingly,i have tried to cover all the possible scenario's.Let me know if you find it help-full or not also let me know how when and why you closed your position once you close this trade.
PS: Tatasteel and sail both posted steller numbers still not reacting much on the contrary it has corrected.