UPL Ltd - Cup & Handle Breakout Setup

20 mar

📊 Trade Plan:

• Breakout Entry: Above ₹662 (With 4x-5x Volume Confirmation)
  
• Stop Loss (SL - Closing Basis): ₹581.95
  
• Target 1 (T1): ₹775
  
• Target 2 (T2): ₹831
  
• Current Price: ₹646
  

📈 Risk & Reward Calculation:

• Risk to SL: ₹646 - ₹581.95 = ₹64.05 (9.91%)
  
• Reward to T1: ₹775 - ₹662 = ₹113 (17.07%)
  
• Reward to T2: ₹831 - ₹662 = ₹169 (25.53%)
  
• Risk-Reward (R:R):
  
• To T1: 1:1.72 ✅
  
• To T2: 1:2.57 ✅
  

📊 Technical Highlights:
✅ Cup & Handle Formation: Classic bullish pattern with a potential breakout
✅ Trading Above Key DMAs: Supports bullish structure
✅ Sectoral Strength: Agrochemicals showing momentum, aiding UPL
✅ Volume Confirmation Needed: Avoid entry without 4x-5x volume spike
✅ Trading Against Trend: Trade light, no heavy positions

📉 Fundamental Concerns:
❌ ROE (-4.28%) & ROCE (3.29%) are poor: Indicates weak profitability
❌ High Debt & Low Efficiency: Capital allocation is not optimal
❌ Dividend Yield (0.15%) is Low: Not an income-generating stock
❌ Market Cap: ₹48,512 Cr – Large cap, but currently weak performance

🔎 Key Insight:
UPL's fundamentals are weak with low profitability (negative ROE) and poor return on capital (ROCE 3.29%), meaning the stock relies more on technical breakout rather than strong financial backing.

⚠️ Risks Involved:
❌ Breakout Failure Risk: If ₹662 is not sustained, stock may fall
❌ Sector Volatility: Agrochemicals are cyclical, demand-dependent
❌ Overall Market Weakness: If Nifty falls, UPL may struggle
❌ Fundamentally Weak: Not ideal for long-term holding

🚨 Disclaimer:
⚠️ This is not financial advice. Trade light and avoid heavy risk, as this setup goes against the long-term trend. Ensure proper risk management before entering. Volume confirmation is a must! 🚀

21 mar

Trade attivo

Entry is triggered, and safe players wait for a close.