Positional trading in the stock market involves holding onto positions for weeks or even months, aiming for substantial returns. One such opportunity currently presents itself with Supreme Industries Ltd., a company showing positive signals for upward movement.
SOURCED: TREADING VIEW
Technical Analysis:
Entry Point: Supreme Industries Ltd. shows promising signs for entry above the 4300 mark. This level indicates a potential breakout from previous resistance, signaling a bullish trend continuation.
Stop Loss (SL): To manage risk, a stop loss is set at 4000. This level is chosen strategically to limit potential losses in case the trade moves against expectations.
Targets: The targets are set progressively higher at 4500, 4700, 4800, and potentially 5000. These levels are identified based on past price action and key psychological levels, offering attractive profit potential.
Hold Period: This trade is suitable for a few weeks, allowing for sufficient time for the anticipated price movement to unfold.
Reasoning:
Reversal from Bottom: Supreme Industries Ltd. has exhibited signs of a reversal from the bottom, indicating a shift in market sentiment from bearish to bullish. This reversal pattern typically suggests a potential trend change and presents an opportunity for traders to enter long positions.
RSI Momentum: The Relative Strength Index (RSI) is trending upwards, indicating increasing bullish momentum. RSI is a momentum oscillator that measures the speed and change of price movements, and its upward movement suggests growing buying pressure in the stock.
Volume Breakout: The breakout is supported by strong volumes, suggesting conviction among market participants in the upward movement of the stock. Volume analysis is essential for confirming the validity of price movements, and a breakout accompanied by robust volume strengthens the bullish case.
Breakout After Consolidation: Following a period of consolidation, characterized by sideways price movement and decreased volatility, the stock is now poised for a breakout. Consolidation phases often precede significant price movements, and a breakout from consolidation signals the resumption of the underlying trend.
Current Status:
Today’s Performance: Supreme Industries Ltd. has already reached a high of 4385.95, indicating early validation of the trade setup. This price movement reinforces the bullish bias and suggests potential for further upside.
Potential Gain: From the entry level, the stock has delivered a gain of 85.95 points, highlighting the profit potential of the trade. This early success underscores the validity of the technical analysis and reinforces confidence in the trade setup.
Conclusion:
Supreme Industries Ltd. presents a compelling opportunity for positional traders, supported by strong technical indicators and favorable price action. The well-defined entry point, strategic risk management, and potential for significant gains make this trade attractive for those looking to capitalize on medium-term price movements. However, it’s essential for investors to exercise caution and conduct thorough analysis before making any investment decisions. Consulting with a financial advisor is recommended to ensure alignment with individual investment goals and risk tolerance levels. Remember, while the analysis provided here serves educational purposes, successful trading requires diligence, discipline, and ongoing monitoring of market conditions.
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