IBULHSGFIN LONG POSITIONAL/SWING TRADE
In depth price action analysis :
1. Indiabulls Housing Finance seems to have found a bottom after the covid crash in March 2020, forming an ascending triangle ever since, and recently giving a breakout with decent volume.
2. There has been an increase in volume not seen before post 2020 suggesting interest in stock. Currently price is retracing back to support zone.
3. The pullback in price has decreasing volume compared to the breakout volume suggesting that this is possibly not a throwback into the triangle, but rather, a re-test of previous resistance as support.
4. Weekly 21 and 55 EMA is currently acting as support. Note that there is a bullish cross of the 21 and 55 WEMA which is a positive sign for bullish continuation.
5. Price is trading above Point of Control (POC) of the volume profile which is another positive sign.
6. Currently price is nearing 0.382 retracement but a pullback to even 0.5 retracement can be possible.
7. Weekly RSI is approaching 50 which means price is cooled down signficantly. price may consolidate further or retrace pulling the RSI down to 43 levels and find support on the RSI trendline which has been forming since more than one year, and bullish momentum will still be preserved.
What to expect :
1. Price may find support at current levels (235-245) which will be good for continued bullish momentum, as RSI is approaching oversold levels on daily timeframe.
2. in case price doesn't hold support at 235 levels, price may continue to retrace to the POC level (220) which is also strong support, and price will continue to form Higher Highs and Higher Lows if 220 support holds.
3. If price fails to hold 220 levels, last stand for bulls would be 190 levels which is the next strong support zone and trendline support from ascending triangle. 190 would be the bulls' final fighting stance to preserve continued upward momentum.
Trade setup
Position size build up can be as follows (this is just an example)
1. 30% of position size at CMP and if there is a reversal from 235-245 levels further 70% can be deployed.
2. In case 235-245 support fails to hold, another 30% can be deployed at 220 levels and the rest 40% after reversal is confirmed.
Targets and Stop Loss
1. Conservative/swing trade stop loss (1-3 months) = 218 which is POC invalidation point.
2. Positional trade stop loss (3-6 months) = 179 which is ascending triangle trendline support breaking point beyond which trade setup will be invalidated completely.
3. First target for swing trade = 310
4. Second target for swing/positional trade = 360
5. Third target for positional trade = 465
6. Price can even go back to previous All Time Highs if trade is kept for a longer period of time.
Please manage position size based on risk appetite and have a suitable risk to reward ratio of your choice.
Note: This is not financial advice, this post is for educational purposes only.
Thank you for reading through this detailed analysis and kindly leave a like if you liked this post!
If there are any questions, please leave it down in the comments section.
1. Indiabulls Housing Finance seems to have found a bottom after the covid crash in March 2020, forming an ascending triangle ever since, and recently giving a breakout with decent volume.
2. There has been an increase in volume not seen before post 2020 suggesting interest in stock. Currently price is retracing back to support zone.
3. The pullback in price has decreasing volume compared to the breakout volume suggesting that this is possibly not a throwback into the triangle, but rather, a re-test of previous resistance as support.
4. Weekly 21 and 55 EMA is currently acting as support. Note that there is a bullish cross of the 21 and 55 WEMA which is a positive sign for bullish continuation.
5. Price is trading above Point of Control (POC) of the volume profile which is another positive sign.
6. Currently price is nearing 0.382 retracement but a pullback to even 0.5 retracement can be possible.
7. Weekly RSI is approaching 50 which means price is cooled down signficantly. price may consolidate further or retrace pulling the RSI down to 43 levels and find support on the RSI trendline which has been forming since more than one year, and bullish momentum will still be preserved.
What to expect :
1. Price may find support at current levels (235-245) which will be good for continued bullish momentum, as RSI is approaching oversold levels on daily timeframe.
2. in case price doesn't hold support at 235 levels, price may continue to retrace to the POC level (220) which is also strong support, and price will continue to form Higher Highs and Higher Lows if 220 support holds.
3. If price fails to hold 220 levels, last stand for bulls would be 190 levels which is the next strong support zone and trendline support from ascending triangle. 190 would be the bulls' final fighting stance to preserve continued upward momentum.
Trade setup
Position size build up can be as follows (this is just an example)
1. 30% of position size at CMP and if there is a reversal from 235-245 levels further 70% can be deployed.
2. In case 235-245 support fails to hold, another 30% can be deployed at 220 levels and the rest 40% after reversal is confirmed.
Targets and Stop Loss
1. Conservative/swing trade stop loss (1-3 months) = 218 which is POC invalidation point.
2. Positional trade stop loss (3-6 months) = 179 which is ascending triangle trendline support breaking point beyond which trade setup will be invalidated completely.
3. First target for swing trade = 310
4. Second target for swing/positional trade = 360
5. Third target for positional trade = 465
6. Price can even go back to previous All Time Highs if trade is kept for a longer period of time.
Please manage position size based on risk appetite and have a suitable risk to reward ratio of your choice.
Note: This is not financial advice, this post is for educational purposes only.
Thank you for reading through this detailed analysis and kindly leave a like if you liked this post!
If there are any questions, please leave it down in the comments section.
