IRIS Set to Blossom: Rounding Bottom Breakout#Stock: NSE:IRIS
#Time frame: Weekly
#Current Price: 125
#Breakout Level: 118
Trade Overview:
In this trade idea, we're eyeing IRIS, which appears to be on the cusp of a major bullish move. The stock has formed a classic rounding bottom pattern, indicating a potential trend reversal. The change in price structure from lower lows and lower highs to higher highs and lower highs is a strong bullish sign. Additionally, the presence of significant buying volume, including recent bulk buying on the NSE, further supports the trade thesis.
Trade Plan:
1. Entry Strategy:
Buy IRIS Limited if the price breaks convincingly above the breakout level at 118, especially after a retest of this level to confirm its newfound support.
2. Stop-Loss:
Set the stop-loss at 88, providing ample room for price fluctuations while guarding against unexpected reversals.
3. Take-Profit Targets:
Set take-profit target 1 at 152, take-profit target 2 at 178, and take-profit target 3 at 202. These levels are based on Fibonacci extensions and represent potential areas of resistance-turned-support.
4. Risk Management:
Given the higher risk associated with such potential gains, limit your risk to a small percentage of your trading capital (e.g., 1-2%).
As the trade progresses in your favor, consider trailing your stop-loss to lock in profits while allowing for further upside.
5. Additional Considerations:
Stay informed about developments in the broader market and the stock's sector to gauge the overall sentiment.
Keep an eye on company-specific news or events that might impact IRIS Limited's performance.
Be prepared for potential resistance at the Fibonacci extension levels and adjust your strategy accordingly.
Example:
Suppose IRIS Limited's price decisively breaks above the breakout level at 118 after a retest, confirming support. You initiate a long position at 118, with a stop-loss set at 88. Your take-profit targets are placed at 152, 178, and 202, aiming for significant gains based on Fibonacci extensions.
Please remember that trading involves risk, and market conditions can change rapidly. The scenario described here is based on hypothetical data, and actual market outcomes may differ. Perform thorough research, consult multiple sources of information, and make informed decisions based on your analysis and risk tolerance.
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Note: This trade idea is for educational purposes only and should not be considered financial advice. Always perform your own research and consider consulting with a financial professional before making trading decisions.
