TrendX

IPO’s can be unpredictable, but there’s a pattern that experienced traders look for the IPO BASE BREAKOUT . It’s your golden opportunity to ride the momentum at the right time.Let’s decode it in this blog.

Let’s first understand, in brief, what an IPO Base is. Whenever a stock gets listed, those who
received the allotment may book some profits, causing the stock price to drop below to
price it was listed

HOW TO TRADE IPO BASE BREAKOUT

Now, whenever the stock breaches the price level at which it was listed and closes above
that level, it transitions from IPO Base to IPO Base Breakout.

We can understand how to trade an IPO Base Breakout by following these steps:

1. First, find stocks that have recently been liste
2. Look listend stocks showing higher volumes than normal below the breakout level.
3. Set an alert at the breakout level.
4. Enter when the price closes above the breakout level.
5. Place your stop loss 2-5% below the entry level.
6. If you want to hold the stock then use 21 ema as support, hold the stock until it does
   not break this 21 ema support.

BONUS TIP (1): Look for stocks with higher volumes than normal before breaching the
breakout level. Higher volumes indicate that big players are entering the stock.

BONUS TIP (2): If you bought the stock during the IPO Base Breakout and its
fundamentals are strong, congratulations! You may have purchased the next multi-bagger
stock.

Finally, book your profit as you see fit, or hold the stock if its fundamentals remain strong

Let’s understand this with the example of KFINTECH:

Look at this chart of KFINTECH after it got listed the stock shrank below the listed price,
Now look at the first image where the stock started forming a base,
and when it broke and closed above the price level at which it got listed (started
consolidating this indicates strength), we have to place our order and then.

Ride the movement and book profit as per your risk-to-reward ratio.

(If you want to learn what ema is, risk-to-reward ratio, and many more pro concepts you can
by joining us: http://t.me/trendxinc).

Here are some examples of what an IPO base breakout does not look like :

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CONCLUSION:

We discussed a simple IPO base breakout strategy to make profits, even if you’re not well-versed in the market. The strategy involves entering the stock when it closes above the listing price and holding it until it breaks key support levels, like the 10 or 21 EMA.