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  • Writer's pictureraytraceventures

Swing trade in Action Construction Equipment on Jul 24, 2023 | Profit of ₹40,300

Updated: Aug 10, 2023

A trade was executed in ACE on the basis of below rationale:

  1. The price was under consolidation for 9 days with no major sell off

  2. The consolidation phase created a nice, tight flag

  3. As the price broke above the range with high volume of > 2.2 M the trade was executed

Entry was made in two parts- 200 qty on July 24 and then 300 qty the next day. In total, 500 qty were bought at an average price of 680.3.

Risk Management The trade was executed with a risk of ~2.8% on the capital deployed which is around 9400. The stop loss was set at 661 level with an expectation to achieve 1:4 target as per risk to reward. Conclusion The trade was booked at 761 price level, with a profit of 40,300 in the 2nd half on Aug. 08 as the price could not hold the 783 level, the high of the day and also, keeping in mind the earnings release date which is on Aug 11. To avoid any kind of shake down due to earnings, the profit has been locked. It may give another opportunity to enter into the trade after Aug. 11. The trade was held for 12 days.


Below is the screenshot of P&L from Zerodha




Learning

The ideal entry point for this trade could be between 630-635, the breakout level. With our current entry level of 680, we can say that it is a late entry and we lost approx. 40 points in our profits.

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