LT Long -Break out of Cup and handle pattern
L&T has given confirmed broke out of Cup and handle pattern on Friday (16-Jul-21)
Although LT has already made small move after the break out,but its still not very late to enter the trade. I spotted this trade only today. It will be great buy if we get this in 1-3% range of CMP (1618 on 16-July-21)
Entry - 1618-20 (Current Value or 1-3% above or below CMP - basically whatever you get)
SL - 1458 ( Low of the handle pattern )
Target - 1840 (CMP plus length of the Cup)
LTOUF trade ideas
Inverted Head and Shoulder on WTF and Cup and Handle on DTF - LTSome Knowledge about MY patterns here :
1) Cup and Handle :
Appearance: Looks like a cup profile with the handle on the die right
Reversal or consolidation: Short-term (up to 3 months) bullish consolidation
Failure rate: 26%
Failure rate if
waited for a breakout: 10%
Average rise 38%, with most likely rise between 10% and 20%
Throwbacks 74%
Percentage meeting and predicted price target: 49% using full formation height, 73% using half formation height Cups with a higher right lip perform better, 40%
versus 35 % average gain.
LT : Cup and handleSince 2010; Prices are trending between channel, which is drawn with yellow colour trend lines but since 2015 majority of time, prices took support at green trend line. In recent past it has Developed cup and handle price patten. You can see the decreased in the volume at handle part which suggest accumulation and handle part has retraced approximately 38.2%, which ensure the good support and healthy trend. Let the price settle over 1600 then 1650 to ensure multi year break out and confirmation of price pattern. Major support is green trend line. Duration of target is 6-8 months. Here, Need to understand the nature of the stock for such big target and duration, LT stock majorly fluctuates on news, earnings and contracts. Nature of the business doesn’t give recurrent cash flow currently they are trending because they have received huge contracts.