All time high and Rising Channel Breakout seen in Gabriel IndiaHello Traders, i have brought another analysis on a pattern breakout which called (Rising Channel Pattern). Well i have marked and written most of the things on chart, but still i am gonna to teach you here guy's about this pattern so if you see this type of Rising channel pattern next time, So at least you guy's will be able to trade. So Let's start.
Q:- What is Rising Channel Pattern and How to trade that?
Rahul:- A Rising channel is the price action contained between upward sloping parallel lines. Higher highs and higher lows characterize this price pattern. Technical analysts construct a rising channel pattern by drawing a lower trend line that connects the swing lows, and an upper channel line that joins the swing highs as shown above in Gabriel India Chart. Guy's Rising channels show a clearly defined uptrend. Traders can take swing trade between the pattern’s support and resistance levels or trade in the direction of a breakout or breakdown.
Above in monthly charts we have seen a neat and clean proper breakout in Gabriel India , at same point there was a all time high which had taken place in september 2017 , after that price started forming Falling Channel Pattern in chart and it has taken support at earlier resistance zone, means price action says once a resistance is always act like support zone, after breaking out the resistance zone . Since then it has never made lower lows, and started forming a Rising channel pattern and now it has broken all time high and given a successfully Rising Channel Pattern breakout .
Now i will tell you how to Trade on this type of pattern or when it gives breakout?
There is two types of trading can be initiate in this, First you can take swing trades when it touches and reverse from lower range of channel. Second you can wait for breakout of channels upper range then you can take entry for long side but, one of the important criteria to bear in mind is there should be at least 4 points of reaction within the channel. Means price should touch at least 4 times lower range of the channel, and guy's Gabriel India Stock has touch 4 times and then given breakout.
I hope guy's you have learned about this pattern very well.
Important Levels for Gabriel India Ltd.
Best buying range will be 250-237
Targets will be 311/372++
Keep Stop loss at 193
Price is above 200 EMA. It is a positive sign for this stock.
Volumes are supporting breakout.
MACD and RSI has given Bullish Crossover.
Note:- Guy's i have not placed any indicator which i have discussed above but i have done analysis on this before publishing this idea. The reason is very simple i want my chart neat and clean and easy to understandable and i want teach purely price and action trading.
So now let's focus about company background.
Gabriel India is part of ANAND Group. From being a single-product company in 1961, They have transformed themselves in line with changing market, technical and social trends and played a key role in limiting emissions of ride control products and foster the cause of environmental protection. Company manufactures over 300 models of ride control products.
Its products include shock absorbers, struts, front forks and others.
It has a vision to be amongst top 5 shock absorber manufacturers in the world by 2025.
Market Cap
₹ 3,564 Cr.
Current Price
₹ 248
High / Low
₹ 252 / 129
Stock P/E
25.1
Book Value
₹ 60.6
Dividend Yield
1.03 %
ROCE
22.0 %
ROE
16.2 %
Face Value
₹ 1.00
Debt
₹ 11.2 Cr.
EPS
₹ 9.88
PEG Ratio
3.59
Promoter holding
55.0 %
Intrinsic Value
₹ 162
Pledged percentage
0.00 %
EVEBITDA
14.0
PROS
Company is almost debt free.
Company has been maintaining a healthy dividend payout of 24.7%
Company's working capital requirements have reduced from 37.1 days to 29.4 days
CONS
Company has a low return on equity of 12.7% over last 3 years.
Disclaimer:- Please always do your own analysis or consult with your financial advisor before taking any kind of trades.
Dear traders, If you like my work then do not forget to hit like and follow me, and guy's let me know what do you think about this idea in comment box, i would be love to reply all of you guy's.
Thankyou.
