Skip to main content

Futures Trade Alert: Tata Motors Witnesses Rising Channel Breakdown

Futures Trade Alert: Tata Motors Witnesses Rising Channel Breakdown

Tata Motors' recent price movement has led to a breach of its rising channel support, a significant technical signal. Additionally, the Relative Strength Index (RSI) has indicated a breakdown within a specific range. 


Further accentuating the change in trend, the Moving Average Convergence Divergence (MACD) indicator has exhibited a bearish crossover. These combined indicators suggest a potential weakening of the prevailing trend.


Considering these factors, a short trade opportunity presents itself in the futures market (please note that the prices mentioned herein are in reference to the spot prices). 


To initiate this trade, a potential entry point lies below 613. It's advisable to consider an equal lot hedge by purchasing a 610 call option with an approximate premium of 22 - 21 (purchasing this option acts as a hedge), simultaneously executed alongside the short trade.


This analysis points toward a potential price decline, with indications pointing to levels around 600 and potentially lower, within the range of 592 - 580. However, prudent risk management is crucial, and thus a stop-loss should be set above 625 on a daily closing basis.


To optimize the trade strategy, the short trade and hedge can be closed simultaneously, aligning with a holding duration of 2 - 3 trading sessions. It's important to note that the suggested trade should be disregarded if the prices exhibit a significant gap up or down during the trade initiation phase.


Tata Motors' recent price behavior has triggered technical signals that suggest a potential downturn. A short trade, in conjunction with a call option hedge, can be a strategic approach to capitalize on this anticipated trend reversal. 


As always, careful attention to risk management and market conditions is essential when executing such trades.

Comments

Popular posts from this blog

Inspirational Story Of Ferrari - Amazing Adviser

Inspirational  Story Of Ferrari Hello friends, today I'm going to discuss one of the most popular sports car companies in the world - Ferrari. Today, each sports car lover dreams to get a Ferrari. It keeps gaining popularity till today. This company was founded by Enzo Ferrari. So let's get to know the success story of Ferrari. Also Read, Success Story Of Amul Success Story of Dominos Pizza The story starts with 18 Feb 1898 when Enzo Ferrari was born in Italy. Enzo was fond of cars right from his childhood. At 10 yrs of age, he went to see a car race with his father.  At that point in time, he decided that he would become a racing driver. After that, he attended many car races. After completing his graduation from Modena College, he worked as a teacher.  But after a few months, he had to join the Italian army for the first World War. In 1916, he suffered a lot with emotions as well as the economy when his brother and father died. After returning from World War, he began to find

Success Story Of Colgate, One Of The Bestselling Toothpaste Brand

Success Story Of Colgate, One Of The Bestselling Toothpaste Brand "It cleans your breath while it cleans your teeth", can you guess whose slogan is this.  If you have guessed correct then today I'm going to tell you the success story of one of the best selling toothpaste brands of India i. e. Colgate.  It's popularity can be measured by thousands of situations where the term toothpaste is replaced by Colgate in India.  Do you know, this brand came into being almost 210 years ago, introduced by Williams Colgate .  And initially, this company used to produce soaps, not toothpaste that too in jars and not tubes.  So now, let's get back to the beginning of the story.  Also Read Success Story Of Haldiram Bujhia Success Story Of Amul How Maggie Became Successful? The founder of Colgate, Willam Colgate was born on 25 Jan 1783 in England. His father was a farmer.  But later, they shifted to Maryland in the US where his father along with a friend began to make candles

Inspirational Story Of BMW - Amazing Adviser

  The wonder of science has shown many miracles in today's age in the form of spectacular vehicles.  Today I will discuss about a German company that specializes in designing cars, bikes and engines - BMW. It came into being before 101 years and is known for its expensive and luxury cars like Rolls Royce and Mini.  But do you know that BMW was in the list of those companies which were restricted to produce any kind of vehicles during the time of World War?  And in that period, this company started making bicycles and kitchen utensils.  Now let's go to the beginning of the story.  Also Read Success Story Of Ambassador Car   Success Story Of Jaguar   Success Story Of UBER     The founder of BMW was Karl Friedrich Rapp. He was born on 24 September 1882 in Germany.  He became a mechanical engineer and opened his start up named Karl Rapp Motorenwerke where mostly aircrafts and their engines were made.  When the first world war started, there was a huge demand of aero engines.  Thus,