Swing trade in Schneider Electric on Aug 14, 2023 | Profit of 56,406

The trade in Schneider Electric has been executed on the below rationale:

1. The price created a rounding bottom on daily time frame which resembles like a bowl

2. The important thing to observe during the rounding bottom phase is the volume. It dried up during that phase of 17-18 days which symbolizes selling by the weak hands only

3. Price broke out the upper limit of the bowl with high volume which confirmed the continuation of the bullish move. The ideal entry should have been made as soon as the price broke the upper limit of the bowl like structure as shown in the image which was around 307-310 level.

1480 quantities were bought at an average price of 320.1

Risk Management

The trade was executed with a risk of Rs. 19,000 which was 4% of the capital deployed in this trade.

Conclusion The trade was exited on the basis of some weakness observed in the candles at the top of the swing high, also the price was going sideways for 5 days after breaking above the resistance of 350 which was not expected as per the targeted ROI hence, the trade was exited at 358.2 with a risk-to-reward ratio of 1:3, generating a profit of Rs. 56,406 which is ~12% of the capital deployed. The trade was held for 24 days.

Below is the screenshot of the P&L from my broker, Zerodha.

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