As we are out of down trend channel and forming swing highs and swing lows stock looks in good up trend, but I am not convinced with the move, reason being DMI and CMF both are not supporting the up move.
I expect stock to correct from supply zone just above CMP.
If we get out of up trend channel then that will be the conformation of correction.
Levels...
I'm looking for a strong break out on either side of consolidation in order to define the trend.
As per RSI, it looks bullish and expected a strong bullish breakout candlestick.
Prior to budget, I'm watching out on this one in order to follow the breakout and continue to ride on the trend.
It seems that the price has come down sharp and a lot. I assume that bottom is very close, at around 1270 levels.
It is because:
1. Harmonic for break out (marked in grey arrow)
2. Fibs retracement of 1.618 of A-B move
3. Long-term impulse leg fibs of 61.8
Therefore, 1270-75 is a strong level to buy back this one.
LT has be going trough the correction after making a top around 1890. The ABC correction has been completed and I would expect the stock to move higher and make new highs now. However, as a conservative target of 1750 and stop loss just below the last low would give a risk reward ratio for 1:2.5.
Happy Trading!!
