Case study: Life Insurance Corporation Nepal (LICN) - a liquidity sweep, a CHoCH and an order block (target reached)

Case study - written after this trade played out, to show the method step by step. It was not a live call, and it isn't advice to buy or sell.

The setup. Life Insurance Corporation Nepal (LICN) had been making lower highs and lower lows on the daily chart. On 2024-11-25 a candle dipped below the last swing low at Rs 1,063.8 and closed back above it: the sell-side liquidity under that low was taken, but sellers couldn't hold the price down.

The trigger. On 2024-11-27 price closed above the last lower high at Rs 1,131.3 - a change of character (CHoCH). The last down candle at the bottom of that move is the order block: Rs 1,063.6 to Rs 1,137.3, in the discount half of the range.

The plan. A limit buy at the top of the block, Rs 1,137.3. The stop just under the block at Rs 1,058.3 - a 6.9% risk. The target 1 : 2 at Rs 1,295.2.

Stage A: the bigger trend was up and the internal structure had just turned up with it - both layers on the same side.

What our data said on 2024-11-28, before the entry: MacroLens Rating D (16/100) - a weak score; the latest report (Q1 81/82, published 2024-11-15) showed earnings of Rs 4.7 a share over the last year, up 35% on a year earlier, and a return on equity of 4%; a P/E of 267 at the entry price; a typical Rs 1.9 crore traded a day (easy to trade). (Bonus shares came after the trade; the chart and prices here are adjusted for them, so as traded they were about 10% higher. The P/E uses the price as traded.) The data was weak: a D rating and an expensive P/E near 267, against profits up 35% on a year earlier. The chart setup still worked - but a trade like this is for the short term only, not an investment. Want to check today's numbers yourself? Use the "Check LICN yourself" links under this idea - the rating, fair value, dump risk, cornering and liquidity are all on the MacroLens NP desk (Pro tools).

What happened. Price came back into the block on 2024-11-28, the order filled, and the target was reached on 2024-12-02.

The lesson. The sweep showed who was in control, the CHoCH confirmed it, and the block gave a place to buy with a clear stop. Waiting for price to come back to the block - instead of chasing the move up - is what made the risk small and the reward twice as big.

The method - swing, internal and fractal structure, order blocks and liquidity - is explained in full in our e-book The Complete NEPSE Trader. The rating, report and broker figures are MacroLens NP's own data as it stood on the entry day.