RCOM on the verge of forming typical bearish Head and Sholders pattern.

Hi All,
RCOM on the verge of forming typical bearish Head and Shoulders pattern.
Look for shorting opportunities if RCOM closes below neck level support 122 Rs.

 

Thanks Shabbir..

 

Nice analysis Chetan. Target will be 113,right?

 

Thanks Malik.
Theoretically target will be the height of head from neck Level. Here it is around 30 points. i.e here 122 Rs as neck level support then target will be 122-30=92 Rs. For safer side since we are in bull market we can keep target around 100-105 Rs and the stop loss above shoulder 139 Rs. This pattern will be confirmed only if it breaks 122 Rs supported with good volume.

 

Today Reliance communication broke neck level support 122 Rs decisively.
Tomorrow RCOM Q1 results will come. If results are bad or not good and if RCOM trades below neck level support this is good candidate for short position.

 

but 115 is support area, and then 110...

I feel very hard to touch 105.
Moreover, if you see chart for last one year its in trading range of 110 to 160

Its a good short candidate only if it breaks 110 decisively.

 

Yes Dinesh, support is @115 and also at @110.
But the pattern formed here the length of the head is very long almost 30 points.
Which will be taken for calculating target from neck level support.
And this pattern will be noticed by most of the pro traders.
So It can easily go upto 110 and achieving 105 needs more momentum to break the support. And we all know when we reach the point of support or resistance we need to be ready with strict trailing stoploss or to take profit.