HOW TO RIDE ON A BULL MARKET STOCK:MCDOWELLS

CASE STUDY:MCDOWELLS(UNITED SPIRITS)

 

In stock market, the low risk strategy is to ride a running train yet many of us refused to do that on assumption that we are late in the journey. Well, here’s one example that breaks this myth.

The stock is McDowell
Here’s the McDowell Weekly Chart

As you can see in the weekly chart above: McDowell stock traded between 1740 and 500 during 2008 and 2012 period. The stock first declined from 1700 to 500 during 2008. It then rallied in 2009 from 500 to near 1700 by end 2010. It then again declined to 500 by Jan 2012. It then made some basing pattern in 2012 and again rallied from 500 to 1700. During second half of 2012: the move was pretty dramatic and vertical to 1700. Anybody who would have seen the move would have given up on the stock at 1700 considering it to be too late to enter. Well, that’s one mistake everyone of us make. We refuse to ride a moving momentum train, instead we hunt for a new one.

Just see what happened after 1700 when stock made a NEW HIGH ABOVE 1740.

Here’s the daily chart

McDowell stock broke out above 1740 and consolidated above it for many months before taking off. The take off was again vertical in April 2014 and stock which made spectacular move in 2012 from 500 to 1700 delivered another strong tradeable gains in 2013. The stock from 1740 has made a move of 60% in 2013 alone. That’s not bad for a stock that made 3x move in 2012. The lesson we all can learn: When a stock is ready to make a big move: it’s worth riding even if you have missed the first 50% of the move