SANOFI - HIGH PROBABILTY POSITIONAL TRADING STRATEGYSANOFI
CMP 5096
A) Weekly chart (HTF)
(1 week = 31 trading hours approximately)
Trend : Up
1) MACD histogram increasing - Means SMA LMA (12/26) distance / difference increasing indicating strength on the stock.
2) ADX at a new high - Suggests strength of the trend.
3) RS above SMA & LMA - Suggests relatively higher flow of money into the stock compared to broader market.
4) Stock above 30 Week EMA - Suggests long term consensus positive.
B) Daily chart (Intermediate Time Frame)
(one fifth of HTF = 31/5 = approx 6 hours, which equals daily time frame)
Trend : Up
1) MACD histogram increasing and has turned positive suggesting 12/26 ema crossover has happened.
2) ADX beginning to rise with current ADX above previous ADX meaning slope beginning to trend upside and ADX above 20 suggests trend possibly intact.
3) RS sloping upwards and above key MAs.
C) 1 Hour Chart (LTF) - Entry Chart
(one fifth of Intermediate Time Frame = 6/5 = approx 1 hour, which equals hourly time frame)
Currently Trend is up with price above 30 period EMA.
WAIT FOR THE PRICE TO FALL TO THE VALUE ZONE BELOW 30 PERIOD EMA AND ABOVE 15 PERIOD EMA. POSSIBLE LEVELS ARE 4950 - 5000 WHICH ALSO IS PREVIOUS RESISTANCE . ENTER WHEN THERE IS A TRIGGER FROM STOCHASTICS (14/3/3) BY WAY OF A CROSSOVER AT OVERSOLD ZONE (BELOW 50).
Stop for this positional trade is 4550 (below 30 week ema).
Target : Trail with 30 week ema for target.
All three time frame charts attached.
