Friday, May 18, 2012

Sesa Goa - Base building?

This blog does not discuss individual stocks because the purpose of the blog is to focus on the Indian stock markets and principles of technical trading.

Yet, a few days ago I discussed the CIPLA chart which had a potential bullish head and shoulder. Today, I am writing about Sesa Goa, another stock with potentially bullish patterns. Probably just a coincidence.

Here is the daily chart for Sesa Goa which shows a potentially bullish head and shoulder pattern. There are any number of ways in which chart patterns can be traded. Readers should consider the method that suits them best.


The chart shows the two shoulders and the head are complete. A breakout above the neckline at 195 should give a target of 216 approx. A stop needs to be placed below the low of the latest bar - 180. For me, this stop is too wide, so I would place it at 188, which is the mid point of the latest bar.


2 comments:

Rushabh Shastri said...

Idfc too making good base....If financial should do still better than this stock may outperform.

Khush said...

These classical neckline and range patterns which are 2-3 month patterns usually happen to be winning trades in most cases for positional traders ... the most recent example was the breakout of BPCL which surged abt 8-9 percent at the time when nifty lost 10%. I am a big fan of such patterns. Thank you for highlighting this.