VPA_TRADER

CHANNEL-TRENDLINE-ACCUMULATION-BREAKOUT-1W/1M

Long
VPA_TRADER Updated   
NSE:UFO   UFO MOVIEZ INDIA
So the concept is:

  • NSE:UFO had been falling till Mar 2020 since 2015. The fall was steady during 2015-2018. But since 2018 we saw a relatively rapid fall till Mar 2020.

  • Since Mar 2020 , it kind of went into a consolidation between 116 and 60 levels.

  • Now let's look at the structure. The entire fall can be condensed into a downsloping channel. There are two upper trend lines . Both have been tested at least 3 times. Currently both these trend lines have been broken. Secondly, we see an accumulation after fall which seems like the consolidation before high momentum breakout.


  • Looking at the Volume Profile , we find the volume near 116-60 level is extremely high as compared to historical volume at previous price levels. Secondly, all the green (buying volume ) is very high and red(sell volume ) is very low. Which further confirms this as an accumulation region.
    i:e During buy volume=high, then price retraces with low volume and then again high volume buy-----> this forms a closed accumulation region.


  • Since the historical volume is low, There is very less barrier or resistance, which means once this breaks out, the momentum can be expected to be smooth and high.



ENTRY-:
Whether this really will be an accumulation will be confirmed by the breakout direction.
A daily close breakout above 116 level will confirm.
So entry at around 116, nevertheless, the entry bar should be green and close above 116.

TARGET AND Exit-:
Since the historical volume is low, it does make sense to assume that when the stock price moves, it can easily pass through without much resistance.

Imp Level-: 300 and 500 (Since these were historical consolidation levels)

So for now the target is all time high. But I would watch near 300 and 500, will trail my stop-loss and if hit, will exit.

STOP-LOSS-:
Since the consolidation was within 60, so stop-loss can be set around 60 level with some buffer using ATR( Average True Range )

NSE:UFO

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**WILL SOON COME OUT WITH A EDUCATIONAL POST ON VOLUME PROFILE**

Comment: Some error in TV did not show Volume Profile.
Please refer to

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