Double Bottom - Power Finance Corporation (PFC)PFC is currently in the process of forming a Double Bottom chart pattern at a strong support zone, indicating a potential reversal from a downtrend to an uptrend. The price is testing the support area, and the second bottom confirms strong demand in this region. A key signal for a bullish outlook is the breakout of the minor downtrend line, which suggests a shift in market sentiment from bearish to bullish.
Key Observations:
1. The Double Bottom pattern aligns with the psychological support level around ₹400, a significant price point for PFC. A breakout above this level is likely to confirm the continuation of the upward momentum.
2. Expectation of a Higher High and Higher Low series post-breakout, signaling the start of a new uptrend.
3. Strong demand at the current level suggests the probability of a positive breakout that will push the price above ₹400 and possibly higher.
Strategy:
Entry: Look for a clear breakout above ₹400 for confirmation of the pattern's activation.
Stop Loss (SL): Adjust stop loss according to the **measurement rule or follow your preferred trailing method to protect gains.
Target: Expecting an upside move, but avoid setting fixed profit-booking levels. Stay flexible with your exit strategy based on market dynamics.
Conclusion:
The formation of the Double Bottom at strong support, coupled with the breakout above the minor downtrend line, presents an opportunity for a positive price action move. A close above ₹400 could trigger further upside momentum, and staying disciplined with stop losses and trailing profits will help manage the trade efficiently.
