ITC India - 4 Reasons to be a bit nervous right now at 445

Although I am still bullish on ITC, there are some warning signs that anyone long / anticipating needs to be looking for and this may save you a lot of money if the stock does reverse from a test of 450+ - volumes have dried up recently indicating that there is not much supply at 450 (which is good)
  • Stretched on the monthly / weekly momentum - although still positive, it is definitely on its last legs (unlike new breakouts like Indigo, Bharti etc)
  • The base is being built - but might still need 1-2 weeks (previous bases took 2 months)
  • Volatility is compressed and this is a positive. It touched 452 in this consolidation and also made a tail down to 430 - which is very normal
  • If the relative strength goes down (compared to nifty) or if it cuts 440 on volumes, then cut off the trade.

Bottomline - Stay long and hope for a clearance of 455 very soon - on good volumes that too. Otherwise be ready to cut this loose if it reverses sharply from here on volumes.
ITC clears 460 on decent volumes. Maybe able to touch 490 or so, which maybe a good place to take off the trader
Trade closed: target reached:
I rolled out at 480 - now will wait for the next base to form. 40 bucks (10%) is a big move for ITC in 2 weeks. It now has to (hopefully) - sit and consolidate.

I still think we are now in the 40th over of this rally in ITC. The last 10 could be big or could be a dump - either way will be exciting!

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