Panacea Biotec – Head and Shoulders

Trade plan:
• Significant bullish rally prior to Head and Shoulder pattern formation (indicating trend reversal)
• Shoulder-head-shoulder pattern can be seen in the graph (where head is significantly higher than shoulders)
• The pattern is formed across a period of 48 days (Shoulder-Head-Shoulder)
• The volume at Left shoulder is high indicating trend reversal from bullish to bearish i.e a stronger hand is liquidating the shares
• Volume is low at Right shoulder indicating the stronger hand has sold the shares and moved out of the market
• Short position created as the price goes below the Neckline at Rs 270.
• Risk to Reward ratio is 1:1
• Hence the Stop Loss created at tip of the Head at Rs. 351 and the Target price is Rs. 190.

Company Name: Panacea Biotec
Direction: Expected direction is Bearish Trend
Entry price: Rs. 270
Stop loss: Rs. 351
Target price: Rs. 190
Duration: Long term