Dalmia Bharat - Double Bottom Chart Pattern
The "Double Bottom" pattern is a bullish reversal chart pattern that suggests the end of a downtrend and the beginning of an uptrend. When observed in Dalmia Bharat's stock chart, this pattern indicates a potential increase in the stock's price. It took almost 2 months to complete the pattern.
Key Characteristics:
Shape: The pattern consists of two distinct troughs at approximately the same price level 1700, resembling a "W" shape.
Neckline: The highest point between the two bottoms forms the "neckline." A breakout above this level confirms the pattern.
Volume: Volume often decreases during the formation of the pattern and increases on the breakout above the neckline, confirming the bullish reversal.
Current Scenario for Dalmia Bharat:
Breakout: Dalmia Bharat's stock has already broken out above the neckline, indicating a confirmed bullish reversal.
Retest: The stock is currently retesting the neckline, a common occurrence where the price returns to the breakout level to test its new support.
Implications:
Market Sentiment: The successful retest of the neckline can strengthen the bullish sentiment, suggesting that the previous resistance level has now become support.
Entry Point: The retest provides an opportunity for investors to enter a long position at a potentially lower risk, as the new support level is confirmed.
Target Price: The target price can often be estimated by measuring the distance from the bottoms to the neckline and projecting it upward from the breakout point. Target level 2000 - 2050
Example:
If Dalmia Bharat's double bottom pattern had bottoms at ₹1,700 and a neckline at ₹1,850, the distance is ₹150. Following the breakout, the target price could be around ₹2,000 (₹1,850 + ₹150).
In summary, the double bottom pattern in Dalmia Bharat suggests a bullish reversal, and the current retest of the neckline is a critical juncture. If the retest holds, it may present a favorable entry point for investors, reinforcing the likelihood of an upward trend.
Regards
Arvind Yadav. Cfa
Arvind Share Academy
Key Characteristics:
Shape: The pattern consists of two distinct troughs at approximately the same price level 1700, resembling a "W" shape.
Neckline: The highest point between the two bottoms forms the "neckline." A breakout above this level confirms the pattern.
Volume: Volume often decreases during the formation of the pattern and increases on the breakout above the neckline, confirming the bullish reversal.
Current Scenario for Dalmia Bharat:
Breakout: Dalmia Bharat's stock has already broken out above the neckline, indicating a confirmed bullish reversal.
Retest: The stock is currently retesting the neckline, a common occurrence where the price returns to the breakout level to test its new support.
Implications:
Market Sentiment: The successful retest of the neckline can strengthen the bullish sentiment, suggesting that the previous resistance level has now become support.
Entry Point: The retest provides an opportunity for investors to enter a long position at a potentially lower risk, as the new support level is confirmed.
Target Price: The target price can often be estimated by measuring the distance from the bottoms to the neckline and projecting it upward from the breakout point. Target level 2000 - 2050
Example:
If Dalmia Bharat's double bottom pattern had bottoms at ₹1,700 and a neckline at ₹1,850, the distance is ₹150. Following the breakout, the target price could be around ₹2,000 (₹1,850 + ₹150).
In summary, the double bottom pattern in Dalmia Bharat suggests a bullish reversal, and the current retest of the neckline is a critical juncture. If the retest holds, it may present a favorable entry point for investors, reinforcing the likelihood of an upward trend.
Regards
Arvind Yadav. Cfa
Arvind Share Academy
Penafian
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