The purpose of this analysis is mainly to give an idea for swing trades to beginners.
Those who struggle to find good swing trades due to lack of knowledge of price action or due to lack of time for chart reading, can follow this simple strategy. Brief points -
Prepare a watchlist of 10-20 good stocks from different sectors (preferably top 2-3 companies of sector, and their major trend should be Bullish). Check the chart of those stocks, most of them either move with support of 50EMA or 200EMA on daily TF.
For those who move with support of 50EMA are more bullish as compared to those which move with support of 200EMA. Prefer trading in those stocks.
Strategy for entry - Whenever price comes very close or below 50EMA, one should enter at CMP or above its high. (position sizing should be kept in mind always). Target should be either 20% or Life-time high level as per the individual stocks. NOTE - if the stock falls below and comes near 200EMA, then 20-30% more quantity may be added in case extra cash is available. No further averaging needed below this.
Although there won't be a need for SL if the stocks are fundamentally strong. because such stocks don't usually stay low for long. But still one can put SL as per their capacity.
P.S - Always take care of your position sizing in any trade. Never put more than 10% of your initial capital in any one stock.
Feel Free to comment for any query on this idea or regarding price action analysis.
ASIANPAINT is another such stock which mostly move with support of 50EMA and gives easy 15-20% in swing.
Do checkout other similar stocks. One can comment their names below as well.
princesood
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@AdityaKarn90, Thanks for this awesome analysis. Few more points which I noticed:
Post-Covid
1. RSI has never been below 40 and takes a bounce from there. This implies a strong uptrend for the stock
2. %B Oscillator has frequently been into the overbought region, which further signals the strength.
At the current CMP, %B just took support from lower. Which further makes this a great entry point.
3.
Furthermore, Fundamentally as well this stock is awesome to keep in one's portfolio. They Clocked the Highest revenue and PAT (profit after tax) this year.
Overall a great short term and long term bet for sure.
PS: If possible could you share your analysis for Asian Paints as well.
Do checkout other similar stocks. One can comment their names below as well.