LTIM Stock: A Case Study in Support and Resistance Trading

 



Support and resistance are price levels where an asset tends to encounter buying or selling pressure respectively. Support is the price level below which an asset is unlikely to fall, while resistance is the price level above which an asset is unlikely to rise. Traders can use these levels to identify potential entry and exit points, as well as price targets for their trades. In technical analysis, support and resistance levels play a crucial role in identifying potential trading opportunities.

Let's take the example of LTIM stock, which had a support zone of 3508-3580 and a resistance zone of 4420-4488.

On 26th February 2021, the stock price took support at the lower end of the support zone, creating a potential buying opportunity. Traders who bought the stock at this level could have seen gains as the price rose toward the resistance zone.

On 9th April 2021, the stock price reacted to the resistance level of 4420-4488, providing traders with a potential selling opportunity. Traders who sold the stock at this level could have realized profits.

The stock price again touched the support zone on 17th May 2021, providing traders with another potential buying opportunity. Those who bought the stock at this level could have seen gains as the price once again rose toward the resistance zone.

On 15th July 2021, the stock price reacted to the resistance level again, providing traders with another potential selling opportunity. Those who sold the stock at this level could have realized profits.

Finally, on 29th July 2021, the resistance level was broken, indicating a potential bullish trend reversal. Traders who bought the stock at the day close price of 4640 could have realized gains as the price continued to rise towards 5532, where they could have sold the stock and realized profits.

In summary, by identifying the support and resistance zones and reacting to the price movements at these levels, traders could have taken advantage of potential buying and selling opportunities in LTIM stock, realizing gains as the stock price fluctuated between the support and resistance zones.

Location: Indore, Madhya Pradesh, India

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