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  • Writer's pictureraytraceventures

Max India on June 26, 2023 | Loss of Rs. 1400

Updated: Jul 21, 2023

A trade was initiated in Max India based on the below rationale: 1. Price has been under consolidation for 9 days. 2. There has been no major selling in pull backs.

3. As the price closed above 10-day Moving Average with strength first entry was made with 700 quantities.

Pyramiding As the price moved in our favor and broke out of the resistance with 430K volume, 709 more quantities have been bought at an average price of Rs. 127.1 sacrificing some gains from previously profitable quantities.

Below is the screenshot of trades executed from Zerodha

Trade executed on June 26 (entry-1)

Trade executed on July 3 (entry-2)

Risk Management Initial risk of Rs. 3400 was defined for the trade which is ~4% of the capital employed which was on the higher side. As the trade moved in our favor, some of the profit has been sacrificed. After the execution of two trades in the same stock now we hold 1409 quantities and the stop loss has been trailed to Rs. 122 level making the total risk of Rs. 3000 in this trade which is ~1.7% of the capital employed in this trade.

Target We are expecting a target of somewhere between 140-142 which will be ~16% ROI. Conclusion The breakout on July 3 was not very convincing, the price did not break the range with strength, the volume did not show up as per expectations. And on the next day i.e. on July 4 it closed below the close of previous day. Hence, it was almost an indication for the breakout failure. So, on the same day I exited the trade with a loss of Rs. 1400. The trade lasted for 5 days.

Below is the screenshot of the candle where I exited.

Screenshot of P&L from Zerodha.

Thanks for reading, have a good day !

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