DLF - After the Rise

In a Conversation with Ramki, we had spoken of the stock being bearish and that a good buy point was 185. The stock has since rallied to 275 - what should you do now?

Deepak takes you through what could have been a stop loss for the past trade, and what you could do now.

(6 min)

With the move in DLF over 250, the stock had broken through the 20 and 50 DMAs, and broke a recent high, plus the MACD went positive. Four technical signals is usually enough to suggest the end of a downtrend.

At 275-280 is a resistance on the upside, being a past low, and only above 281 is the stock a strong contender to move to 300. If it doesn't break that figure soon, there is a small short opportunity for a person with a negative view (targets aren't clear). But if it breaks 281 it should head to 300, which has the additional attraction of being a nice round number.

Disclosure: Long DLF through a covered call.

Comments

Nicely explained, Deepak.. +1

Nicely explained, Deepak..
+1 for following up with the earlier view and how it panned out.