SESA STERLITE LOOK HOT &FIERY

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BUY ABV 180 SL 175 ON CLOSING BASIC TGT 190 -195 LOT SIZE 2000 TARGET 1 ACHIVED TODAY PROFIT 20000 RS

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FLAG BREAK OUT IN SESA GOA

Sesa Goa has broken out of Bullish Pennant Pattern and it does not surprise . I had covered the stock a month back to buy at 175 stock now crosses 194 still look highly bullish
http://trendzofmarket.blogspot.in/2013/09/is-sesagoa-turning-around.html 

LETS CHECK THE NEW DEVELOPMENT IN THE STOCK 

What is a Bullish Pennant Pattern?

A continuation pattern in technical analysis formed when there is a large movement in a stock, the flagpole, followed by a consolidation period with converging trendlines, the pennant, followed by a breakout movement in the same direction as the initial large movement, the second half of the flagpole ~ As per Investopedia

Technical Characteristics:

Formation of Flagpole: To be considered a continuation pattern, there should be evidence of a prior trend. A sharp advance is must before the formation of pennant. The Sharp advance looks like a Flagpole

Pennant: A pennant is a small symmetrical triangle that begins wide and converges as the pattern matures. The price action remains within the converging trend lines. pennants are short-term patterns that can last from 1 to 12 weeks
Once a pattern is in place – one should watch for Breakout from the Pennant.

Here’s the Sesa Goa Chart doing the same

 

 There is a Flagpole and formation of pennant from which stock broke out this week and on good volumes. The stock can shock on the upside. The breakout is not surprising and I covered the stock a month back.

http://trendzofmarket.blogspot.in/2013/09/is-sesagoa-turning-around.html 

IS SESAGOA TURNING AROUND

Sesa Goa was in serious Downtrend
As you can see in the monthly chart below: Sesa Goa stock was in severe downtrend between April 2010-July 2013. The stock from levels of 480 declined to 127 in July 2013. That's not all, with the price decline - the stock also witnessed lack of trading interest.


 Why focus on Sesa Goa now?: WHAT HAS CHANGED
The Chart says it all. Below is the weekly chart of Sesa Goa.
 


Sesa Goa on weekly basis saw a huge up move from levels of 125-130 to 200 in less than 4 weeks in August 2013. It was not only the price action but also the volume action that shocked the market participants. The move has changed the sentiment on the stock
Now also note that prior to this weekly move: stock had stalled around 200 in 2012 before selling off in 2013.
 How should one play turnaround?
We don't know that whether Sesa Goa stock has turned around conclusively as stock is still trading below resistance of 200. At this point of time - there are lots of evidence that do suggest that turnaround may be happening.
Hence, we can start off by making an assumption that stock is turning around.


 Stock after a big weekly move - is consolidating on weekly basis. Look at the last three candles. Such consolidation generally turns out to be a great Buying Opportunity especially at lower levels. On weekly chart, it means stock is very attractive buy near 170-180 levels. One can put a stop loss on closing basis below 160 with target of 270+

Trading Strategy
Go Long at 176.
Closing Stop Loss below 160
Target: Buy and Ride for 4-6 weeks

The research note has been written purely for educational purpose. Please do your own due diligence before trading. Please do not make BUY or SELL decision based solely on this report. Do your own research.