Technical Overview
Descending Triangle Pattern:
Support and Resistance:
Moving Averages:
RSI (Relative Strength Index):
Volume:
Target Price:
Conclusion:
The stock is currently trading near a critical support zone in a descending triangle pattern. Given the bullish divergence in the RSI, there's potential for a bounce. However, traders should wait for a breakout above the 289.60 INR level for bullish confirmation or a breakdown below 265 INR for bearish continuation.
Risk/Reward Tip: Use stop-loss strategies close to support and resistance levels to manage risk effectively, as either scenario (breakout or breakdown) can lead to significant moves.
Descending Triangle Pattern:
- The price action appears to be forming a descending triangle, which is typically considered a bearish continuation pattern. The triangle's resistance line is a downward-sloping trendline connecting the series of lower highs, and the support is horizontal around the 270-265 INR level.
Support and Resistance:
- Immediate Resistance: The first resistance is at 289.60 INR, as indicated by the horizontal line.
- Major Resistance: Above this, significant resistance exists around 312.70 INR and 340.25 INR.
- Support Zone: The highlighted yellow area between 265-270 INR indicates strong support. The price has tested this zone multiple times without breaking down, suggesting that it is a key area to watch for either a bounce or a breakdown.
Moving Averages:
- 50-Day Moving Average: The price is currently close to the 50-day moving average. A breakout or breakdown from this average could provide a signal for further price movement.
- 200-Day Moving Average: The 200-day moving average is trending upwards and acts as long-term support. It's a key indicator for identifying the overall trend, which remains bullish in the long term.
RSI (Relative Strength Index):
- The RSI is showing a bullish divergence. Even though the price has made a lower low, the RSI has formed a higher low, signaling a potential reversal or bounce from the current levels.
Volume:
- There is a noticeable drop in volume over the recent sessions, suggesting that traders are waiting for a decisive move. If the price breaks either the support or resistance lines, a spike in volume will likely confirm the direction of the move.
Target Price:
- Bullish Target: If the price breaks above the descending triangle and crosses the resistance at 289.60 INR, the next target could be 312.70 INR, with a long-term target around 340.25 INR.
- Bearish Target: A breakdown below 265 INR could lead to further declines, with the next significant support level around 240 INR.
Conclusion:
The stock is currently trading near a critical support zone in a descending triangle pattern. Given the bullish divergence in the RSI, there's potential for a bounce. However, traders should wait for a breakout above the 289.60 INR level for bullish confirmation or a breakdown below 265 INR for bearish continuation.
Risk/Reward Tip: Use stop-loss strategies close to support and resistance levels to manage risk effectively, as either scenario (breakout or breakdown) can lead to significant moves.
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.
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.