Chart Busters: Top trading set-ups to watch out for on Monday.

Chart Busters article.
by 5paisa Research Team 04/10/2021

The broader market has outperformed benchmark indices on Friday. Here are the top trading set-ups to watch out for Monday.

Surya Roshni: After registering the high of Rs 840, the stock has witnessed minor correction, which resulted in the formation of a bullish pennant pattern. The correction is halted near the 38.2% Fibonacci retracement level of its prior upward move. On Friday, the stock has given a breakout of bullish pennant pattern on the daily chart. This breakout was confirmed by the above 50-day average volume. Additionally, the stock has formed a sizeable bullish candle on breakout day, which adds strength to the breakout. The bullish pennant pole height is almost 330 points. All the moving averages based on trade set-ups are showing a bullish strength in the stock. Daryl Guppy’s multiple moving averages is suggesting a bullish strength in the stock. The stock is trading above all the 12 short and long term moving averages. The averages are all trending up, and they are in a sequence. Interestingly, the leading indicator, 14-period daily RSI has given bullish crossover in bullish territory.

Technically, all the factors are currently aligned in support of the bulls. Hence, we would advise the traders to be with a bullish bias.

Going ahead, on the upside, the prior all-time high may act as crucial resistance for the stock. Any sustainable move above this resistance would result in a sharp upside. On the downside, the 13-day EMA is likely to act as strong support, which is currently placed at Rs 738.20 level.

Titagarh Wagons: On Friday, the stock has given ascending triangle pattern breakout on the daily chart. This breakout was supported by a robust volume of nearly four times of 50-days average volume. The 50-days average volume was 17.79 lakh while today the stock has registered a total volume of 69.28 lakh. Generally, the volume criteria become significant when the stock is breaking out of the consolidation, and the stock that witnesses breakout on the back of over and above 50-days average volume, confirms the validity of the breakout. Currently, the stock is trading above its short and long-term moving averages. These averages are in a rising trajectory.

Talking about the indicators, the 14-period RSI on the daily time frame has marked a fresh 14-period high and also, the RSI is trading above its previous swing high. The weekly RSI is in the super bullish zone. Further, the daily MACD stays bullish as it is trading above its zero line and signal line. Hence, we expect the bias to remain positive as long as stock sustains above Fridays low of Rs 96 level. On the upside, the level of Rs 114 may act as crucial resistance as per the measure rule of ascending triangle pattern.

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