Neuland chart was covered on Oct 1 2022 and above observations were quoted. Since then stock price managed to cross the crucial resistance of 1470 (after some brief consolidation around that level ) and it gave a sharp rally to post swing high of 2002. Major resistance was seen at levels of 1860 where previously there was strong resistance. Currently stock price is undergoing consolidation and we need to see how it behaves post this consolidation. Its important to keep watching daily charts to see any signs of a major trend change on daily time frame. On weekly its already in an uptrend and is consolidating.
Shown in attached chart is support zone (in dotted green lines) mentioned in previous post which was in region of 970-1300 and that did provide support for consolidation. And upper boundary of consolidation is marked in solid navy blue line at 1470. Above that, major resistance is shown in dotted red line at 1860. Till now everything has played out according to technicals.
For me it was a way to look at how to play for bounces in stocks which have corrected sharply. These bounces may be dead cat counter trend bounces, or the real deal meaning, a major trend change. Key learning here was not to waste time by getting in at or near bottom and face the frustrating time of consolidation. Ideal time is to get in at the time of breakout from consolidation ranges… Most important factor to watch is the volumes at the time of breakout. This kind of learnings will provide an important weapon in the arsenal of technical analysis because everyone nowadays is going in for breakouts, so playing pullbacks could be the less crowded trade.
| Subscribe To Our Free Newsletter |
