Double Bottom Pattern FormationDouble Bottom Pattern Formation in Daily Chart of PONNIERODE
What is Double Bottom Pattern?
The double bottom pattern is a popular technical chart pattern used in financial markets, particularly in stock trading and investing. It is considered a bullish reversal pattern, signaling a potential change in the trend from a downtrend to an uptrend.
The pattern consists of two significant lows (or troughs) on a price chart that are approximately at the same level, separated by a temporary peak (or high) in between. Visually, it looks like the letter "W."
Here are the key characteristics of the double bottom pattern:
Downtrend: The double bottom pattern occurs after a prolonged downtrend, indicating that the price of the asset has been decreasing over time.
First trough: The first low point (trough) forms as the price reaches a bottom and begins to rebound slightly.
Temporary peak: After the first trough, the price retraces upwards, forming a temporary peak or a small rally.
Second trough: Following the temporary peak, the price declines again but typically does not fall below the level of the first trough. The price then rebounds once more, forming the second trough at a similar level to the first trough.
Breakout: The confirmation of the double bottom pattern comes when the price breaks above the resistance level formed by the temporary peak between the two troughs. This breakout signals that the downtrend may have ended and a new uptrend is potentially starting.
Volume: Ideally, the trading volume should show a decrease as the pattern forms and then increase when the price breaks out of the pattern. The volume pattern should generally mirror the price pattern, with a higher volume during the breakout.
Traders and investors often use the double bottom pattern to identify potential buying opportunities. Once the pattern is confirmed with a breakout, they may enter a long (buy) position with a stop-loss order placed below the pattern's lowest point. The profit target can be set based on technical analysis or by measuring the pattern's height and projecting it upwards from the breakout level.
As with any technical analysis pattern, it's essential to use the double bottom pattern in conjunction with other indicators and analysis tools to increase the probability of successful trades and to manage risks effectively. Moreover, like all technical patterns, the double bottom is not foolproof, and there is always a risk of false signals, so it's essential to practice prudent risk management when trading based on chart patterns.
Note for everyone who came across this reference:
This chart analysis is only for reference purpose.
This is not buying or selling recommendations.
I am not SEBI registered.
Please consult your financial advisor before taking any trade.
PONNIERODE
PONNI SUGARS ERODE is ready to EXPLODE
This is a NO BRAINER.
Beautiful multi year retest at support from 2013.
All you need here is Patience.
Further the company fundamentals are good too.
Debt Free
The Co. became a zero debt entity by end Q1 FY22, while temporary surplus funds are being parked in Bank FDs, pending capex spend on its ethanol project.
- Company is almost debt free.
- Stock is trading at 0.76 times its book value
- Company is expected to give good quarter
- Debtor days have improved from 45 to 19 days.
- Company's working capital requirements have reduced from 78 days to 54 days
- PE Ratio is 8.6 vs its sector PE ratio of 14
- Annual Revenue rose 52%, in the last year to Rs 450 Crores. Its sector's average revenue growth for the last fiscal year was 22%.
- Annual Net Profit rose 31% in the last year to Rs 38 Crores. Its sector's average net profit growth for the last fiscal year was 22.1%.
- Quarterly Revenue rose 16% YoY to Rs 107 Crores. Its sector's average revenue growth YoY for the quarter was 7%
- Quarterly Net profit rose 208% YoY to Rs 6 Crores. Its sector's average net profit growth YoY for the quarter was 11%.
Ponni Sugars (Erode) Limited is a sugar manufacturing company. It is an associate of Seshasayee Paper and Boards Limited. It has a sugar factory at Erode (Tamilnadu) having a capacity to crush 3500 tonnes of sugarcane per day and generate 19 MW of power.
Business Segments
Sugar (71% of revenue)
Power (12% of revenue)
PONNIERODE - Ichimoku Bullish Breakout Stock Name - Ponni Sugars (erode) Limited
Ichimoku Cloud Setup :
1). Today's close is above the Conversion Line
2). Future Kumo is Turning Bullish
3). Chikou span is slanting upwards
All these parameters are showing bullishness at Current Market Price
and more bullishness AFTER crossing 530
#This is not Buy and Sell recommendation to any one. This is for education purpose and a helping hand to learn trading in Market.
# Cloud Trading
# Ichimoku Cloud
# Ichimoku Followers
I hope you all like my analysis.
Please do share your thoughts into comment section.
Please give a like, share & subscribe for daily analysis.
PONNIERODE - Ichimoku Bullish Breakout Stock Name - Ponni Sugars (erode) Limited
Ichimoku Cloud Setup :
1). Today's close is above the Conversion Line
2). Future Kumo is Turning Bullish
3). Chikou span is slanting upwards
All these parameters are showing bullishness at Current Market Price
and more bullishness AFTER crossing 292
#This is not Buy and Sell recommendation to any one. This is for education purpose and a helping hand to learn trading in Market.
# Cloud Trading
# Ichimoku Cloud
# Ichimoku Followers
I hope you all like my analysis.
Please do share your thoughts into comment section.
Please give a like, it motivates me to do analysis.