Momentum calls are again gaining momentum given that market environment is now conducive.
We managed to capture sharp reversal on upside in JSW Steel just about the breakout area near 227 levels and it rushed to above 254 in just 4 trading sessions giving a return of more than 10%. Will all stocks behave like this? No! It is therefore best to keep booking partial profits to ensure capital protection which is the top priority. Managing risk and letting profits run is the key to trading success.
I will be talking about these methods in much detail on how to select momentum stocks using Ichimoku Cloud, Neo wave, Volume profile in the upcoming training on Most advanced Technical analysis training.
We have been using Elliott wave combined with different indicators like Fibonacci retracement based on Elliott wave counts and EMA and it’s amazing to see how well they work. We were successfully able to predict the upmove in the form of wave 4 with the help of Elliott waveand scenario and gave a return of more than 10% that too in just 4 trading days post initiation.
Below is the chart showing detailed analysis published in our research report -“The Financial Waves Momentum Update”
JSW steel Daily chart: (Anticipated as on 29th October 2019)
JSW steel Daily chart: (Happened as on 04th November 2019)
(Following research is taken from Momentum report published on 29th October 2019)
Momentum stock recommendation: JSW Steel
Buy Price – Buy above 227
Time Horizon –Not Applicable
Investment – 5% of capital
Target price –250
Stop loss–214
Partial Profit levels- 236
*Trail stop to cost after booking partial profits to ensure capital protection*
Elliott Wave analysis:
Anticipated as on 29th October 2019: JSW steel in the previous session broke above the resistance level of the channel. As per the wave theory we seem to have completed wave a and moving higher in the form of wave b of the higher degree wave 4. Currently we seem to be moving towards the 250 level which happens to be 38.2% of wave (c) and also the 150 Days EMA, which has worked as amazing support and resistance levels previously.
The consolidation between 215 and 226 levels took around 9 days and prices broke above the same near 227 levels. So this becomes a classic entry level. Also it is prudent to keep booking partial profits to ensure capital protection once we see a move in favor.
In a nutshell the trend for JSW steel looks positive and is making a move towards the 250 level. One can book partial profits at 236 and trail stop to cost.
Happened as on 4th November2019: The stock has shown amazing outperformance amongst its peers in the Metal sector. Prices moved in sync with our expectation and achieved the target and touched high above 254 levels.
The above research clearly shows how one can capitalize the study of Elliott wave and ride the trend. To know more about our next pick and to ride the trend in momentum stocks you can get access to our report “The Financial Waves Momentum Update”- Get access here
Also learn the above techniques in my upcoming training –Attend most advanced technical analysis training – Elliott wave, Neo wave, Hurst’s Time cycles combined with Ichimoku Cloud to be conducted on 30 Nov- 1st Dec 2019. Only a few seats left. Register here
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