The chart indicates a "Cup and Handle" pattern, which is a bullish continuation pattern. The price has formed a rounded bottom (the cup) and appears to be forming the handle, suggesting a potential breakout above the resistance level.
The stock is currently testing the resistance zone around 597-600 INR, which is a crucial breakout level for the completion of the pattern.
Volume Confirmation:
The breakout attempt is accompanied by increasing volume, which is a positive sign indicating strong buying interest. This volume confirmation supports the likelihood of a successful breakout.
Entry Point:
A good entry point would be on a confirmed breakout above 600 INR with strong volume, or on a pullback to the 590-600 INR range, provided the pullback is on lower volume, indicating consolidation rather than a reversal.
Stop Loss:
Place a stop loss below the handle low, around 570 INR, to protect against false breakouts or pullbacks that invalidate the pattern. This placement gives a buffer zone below the key support areas.
Targets:
The first target could be set around 650 INR, which is a calculated target based on the depth of the cup. A longer-term target can be set around 675-700 INR, aligning with previous highs and potential psychological levels.
Risk-Reward Ratio:
Aim for a risk-reward ratio of at least 1:2. With an entry near 600 INR and a stop loss at 570 INR, targeting 650 INR or higher provides a favorable setup.
Additional Considerations:
Watch for the RSI and other momentum indicators to ensure they are not in overbought territory when entering. A strong trend with momentum confirmation will enhance the trade setup.
Keep an eye on overall market conditions, as they can influence the performance of the stock.
Summary: Berger Paints is showing a promising Cup and Handle pattern with the potential for a breakout above the 600 INR level. A breakout with volume confirmation offers a good entry point for a positional trade targeting 650 INR and beyond, with a stop loss to manage risk below 570 INR. This setup presents a strong opportunity, provided market conditions remain favorable.
The stock is currently testing the resistance zone around 597-600 INR, which is a crucial breakout level for the completion of the pattern.
Volume Confirmation:
The breakout attempt is accompanied by increasing volume, which is a positive sign indicating strong buying interest. This volume confirmation supports the likelihood of a successful breakout.
Entry Point:
A good entry point would be on a confirmed breakout above 600 INR with strong volume, or on a pullback to the 590-600 INR range, provided the pullback is on lower volume, indicating consolidation rather than a reversal.
Stop Loss:
Place a stop loss below the handle low, around 570 INR, to protect against false breakouts or pullbacks that invalidate the pattern. This placement gives a buffer zone below the key support areas.
Targets:
The first target could be set around 650 INR, which is a calculated target based on the depth of the cup. A longer-term target can be set around 675-700 INR, aligning with previous highs and potential psychological levels.
Risk-Reward Ratio:
Aim for a risk-reward ratio of at least 1:2. With an entry near 600 INR and a stop loss at 570 INR, targeting 650 INR or higher provides a favorable setup.
Additional Considerations:
Watch for the RSI and other momentum indicators to ensure they are not in overbought territory when entering. A strong trend with momentum confirmation will enhance the trade setup.
Keep an eye on overall market conditions, as they can influence the performance of the stock.
Summary: Berger Paints is showing a promising Cup and Handle pattern with the potential for a breakout above the 600 INR level. A breakout with volume confirmation offers a good entry point for a positional trade targeting 650 INR and beyond, with a stop loss to manage risk below 570 INR. This setup presents a strong opportunity, provided market conditions remain favorable.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.