DIXON Hey Folks,
Today we are talking about Dixon Technologies aka foxconn of India. the Q3 results shows +68% in PAT. which looks good as headline numbers. but diving deep I found that Dixon tech slides over a thin margin module as it is high-volume producer to marquee clients and that operating margin didn't show up as good as the other metrics, which seems attractive.
So, considering current geopolitics any slight hike in raw material could easily affect the operating cost thus affect on the profits.
But Yesterday, we found out the US INDIA Trade Deal out of blue which likely seemed to give more edge to the company in the export service. also the New budget aligns in favour with the manufacturing sector, that's also likely to give certain edge if the company keep the capital expenditure in check with the expectation to the last quarter.
Now, looking technically for long term perspective on the weekly chart. it has sustained above the 200EMA with a large green candle today. Also it closed above the last key support of 10650 (horizontal line in the chart). next target is the 0.78 level of fib i.e. 11700 to tackle. if it breaks that finds it fair value above that zone. we might see the new high of DIXON in near future.
I do not complicate much in technicals for long term view. So open to discussion how you look at it.
:) Thanks. Happy trading.
Trade active
The stock is now testing the resistance of 11,700 (0.786 of the my fib retrace). with the current advancement of the US-India trade deal. we can see a further rally and break of this resistance level soon. so i am hanging onto my Entry.new SL is 10650. why so close ? well if India soon does not give clarity on the Russian trades to follow, all the progress with US might take a hit and we will be back to square one and we all know what happens when investors collectively get angry with such diplomacies collapse.
Trade closed: stop reached
SL of 10650 was reached this week. the stock took a strong resistance and reversed from the 78.6% fib level. but the price is below its weekly 200EMA now that makes a 10650 exit more safer for now. The brokerage downgrading and lowering price targets with institutional profit booking caused the stocks to take a turn from the 11700 level. a candle closing above 11700 level would have helped price moving upward.
But this trade had to be closed @ SL Limit.
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Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.