Potential Multi-Year Breakout: Monthly Timeframe: Month Oct-24

10 ott 2024

Potential Multi-Year Breakout: Monthly Timeframe: Month Oct-24

Price, Volume, RSI, Timeframe of breakout & Timeframe of analysis

• Stock is about to break its all time high (1819.20) it made in Jan'18. Ignoring the wick of the Jan'18 candle since the wick is much larger than the body
  
• Volume in the month of Oct'24 is currently (10-Oct'24) NOT above the 9 SMA [NEGATIVE]
  
• RSI in the month of Oct'24 (79.38) is above 60 as of 10-Oct'24
  
• A multi-year (6+ years) breakout on a monthly time frame
  

Numbers

• Breakout analysis High (Jan-18) = 1819.20/-
  
• Drawdown (marked on chart) = 1040.50/-
  
• SuperTrend (Oct'24) = 1112.83 is positive
  
• ATR (Sep'24) = 174.53
  
• Low made in the last analysis time frame (Sep'24) = 1436.85
  

• Entry = TBD (~ 1959 see below)
  
• Target = Breakout level + Drawdown during consolidation phase = 1819.20 + 1040.50 ~ 2850
  
• Stop Loss = 1 ATR below analysis candle's (TBD) low = 1436.85 - 174.53 ~ 1260
  
• Risk:Reward = 1:1.27
  
• Exit criteria = Reaches Target || Supertrend turns negative || Price goes below 18 EMA
  
  • Will enter on a green monthly candle, if it closes comfortably above the breakout level (1819.20/-).
    
  • Will also enter if price goes in the range of 1959.
    
  • 1959 was computed using ATR to identify a price level, which if reached, gives the stock a good chance that it shall also close above the breakout level by the end of the month. Since 3 weeks of a total of 5 weeks remain in the month of Oct, on the day of the analysis (10-Oct), I take 4/5th of the ATR at the previous candle (Sep'24) and add it to the level above which I would like the monthly candle to close.
    
  • ATR (Sep'24) = 174.53
    
  • 4/5th of ATR (Sep'24) = 139.62
    
  • Level above which I would like the stock to close = Breakout level = 1819.20
    
  • 4/5th of previous month's ATR + Breakout level ~ 1959
    

Additional Notes
* The trade can be made more attractive if we consider the close of the Aug'24 cande, rather the consider the low of the Sep'24 candle for computing the stoploss
* Using the Aug'24 candle close the stoploss becomes = 1562 - 174.53 ~ 1380

12 ott 2024

Nota

Week of 14-Oct

• Entry = TBD (~ 1924 see below)
  
• Stop Loss = 1 ATR below analysis candle's (TBD) low. Assuming we enter the stock in Oct'24 it would be = 1436.85 - 174.53 ~ 1260
  
• Risk:Reward = 1:1.39
  
• Exit criteria = Reaches Target || Supertrend turns negative || Price goes below 18 EMA
  
  • Will enter on a green monthly candle, if it closes comfortably above the breakout level (1819.20/-).
    
  • Will also enter if price hits 1924 during the month
    
  • 1924 was computed using ATR to identify a price level, which if reached, gives the stock a good chance that it shall also close above the breakout level by the end of the month. Since 3 weeks of a total of 5 weeks remain in the month of Oct, on the day of the analysis (14-Oct), I take 3/5th of the ATR at the previous candle (Sep'24) and add it to the level above which I would like the monthly candle to close.
    
  • ATR (Sep'24) = 174.53
    
  • 3/5th of ATR (Sep'24) = 104.72
    
  • Level above which I would like the stock to close = Breakout level = 1819.20
    
  • 3/5th of previous month's ATR + Breakout level ~ 1924
    

12 ott 2024

Nota

Ignore the above comment made on the Week of Oct'14

Week of 14-Oct'24

• Entry = TBD (~ 1819.20 - 1990) see below
  
• Stop Loss = 1 ATR below analysis candle's (TBD) low. Assuming we enter the stock in Oct'24 it would be = 1436.85 - 174.53 ~ 1259 (Reducing to a multiple of 10 and then avoiding whole numbers)
  
• Risk:Reward = 1.18:1 (not a great trade)
  
• Exit criteria = Reaches Target || Supertrend turns negative || Price goes below 18 EMA
  
  • Will enter on a green monthly candle, if it closes comfortably above the breakout level (1819.20/-)
    
  • Will also enter if price goes above the breakout level + ATR anytime during the month = 1819.20 + 174.53 ~ 1990