Confirmed Breakout and Retest of Channel Resistance.Entry Zone: We recommend accumulating Rolex Rings Ltd. in the zone of ₹1,460 - ₹1,500. This area represents a crucial retest of the broken descending channel's resistance, now acting as strong support.
Target 1 (T1): ₹1,580
Target 2 (T2): ₹1,650
Target 3 (T3): ₹1,750 (Extended target if momentum remains strong)
Stop Loss (SL): ₹1,400 (Strictly on a daily closing basis)
Rationale:
Clear Channel Breakout: The stock has executed a textbook breakout from a well-defined multi-month descending channel. This indicates a significant shift in the underlying trend from bearish to bullish.
Successful Retest: Post-breakout, the price has pulled back to retest the upper boundary of the channel, which is a classic technical confirmation of a valid breakout. The retest appears to be holding, suggesting the former resistance has turned into reliable support.
Volume Confirmation: The initial breakout was supported by decent volumes, and the current consolidation/retest phase is occurring on relatively lower volumes, which is typical before the next leg up.
RSI Bullish Momentum: The Relative Strength Index (RSI) is maintaining its position above the 50-mark and shows bullish bias, supporting the upward price momentum.
Favorable Risk-Reward: The current entry point offers an attractive risk-reward profile for a short-term trade, with the potential upside significantly outweighing the downside risk defined by the stop-loss.
Key Risk: A decisive daily closing below ₹1,400 would invalidate the bullish breakout and retest pattern, suggesting a false breakout or a resumption of the downtrend. Strict adherence to the stop-loss is advised.
Disclaimer : This report is for informational purposes only and does not constitute financial advice. Investors should conduct their own due diligence and consult with a qualified financial advisor before making any investment decisions. Equity investments are subject to market risks.
For Education purposes only
