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

Chart Busters: Top trading set-ups to watch out for on Monday.
by 5paisa Research Team 11/10/2021

On the last trading session of the week, the benchmark index has opened with an upside gap but thereafter traded in a narrow range. The index has failed to mark a fresh all time high on Friday. On the daily chart, the index has formed a Doji candlestick pattern, which indicates uncertainty near all-time high level. However, the Nifty Midcap 100 and Nifty Smallcap 100 has marked fresh all-time high.

Here are the top trading set-ups to watch out for on Monday. 

Xchanging Solutions: Considering the weekly chart, the stock has given a breakout of downward sloping trendline resistance as on the weekend of July 16, 2021, and thereafter witnessed a sharp upside of nearly 52 per cent. After registering the high of Rs 141, the stock has witnessed correction along with low volume. The correction is halted near the 61.8% Fibonacci retracement level of its prior upward move and it coincides with the 20-week EMA level.

On Friday, the stock has given downward sloping trendline resistance breakout on the daily chart. This breakout was confirmed by above 50-days average volume. Friday’s volume is highest after July 23, 2021, which indicates strong buying interest by market participants. Interestingly, the slope of short and long-term moving averages is rising which is a bullish sign. The 14-period RSI on the daily timeframe is in bullish territory and on Friday, it has surged above its prior swing high. The daily MACD stays bullish as it is trading above its zero line and signal line. The MACD histogram is suggesting a pickup in upside momentum. The technical evidence indicates a strong upside in the coming weeks. The prior high of Rs 141 will act as crucial resistance for the stock. While on the downside, the zone of Rs 112-113 is likely to provide the cushion in case of any immediate decline.

Firstsource Solutions: The stock has formed a spinning top like candlestick pattern as on the weekend of July 23, 2021, and thereafter witnessed correction. The correction is halted near the 38.2% Fibonacci retracement level of its prior upward move. For the last 10 weeks, the stock is oscillating in a narrow range, which resulted in the formation of ascending triangle pattern on the daily chart. Due to the narrow range, the Bollinger band, which have developed on the basis of the last 20-days volatility, has been contracted significantly. This is an early indication of expansion in volatility.

Currently, the stock is on verge of giving a breakout of ascending triangle pattern on the daily chart. In addition, dramatically increased volume indicates that there was a good chance that the upper trendline resistance of ascending triangle would be taken out. The momentum indicators and oscillators are also supporting the overall bullish price structure. The 14-period RSI on the daily and weekly chart is in bullish territory. Furthermore, in the recent sideways to corrective mode, the RSI has taken support near the 60 mark, which indicates that the stock is in a super bullish range as per RSI range shift rules. Going ahead, in case, if the stock is sustaining above the zone of Rs 214-Rs 216, we may witness a sharp upside in the stock. On the downside, the 20-day SMA is likely to act as short-term support for the stock.

 

 

 
 

On the last trading session of the week, the benchmark index has opened with an upside gap but thereafter traded in a narrow range. The index has failed to mark a fresh all time high on Friday. On the daily chart, the index has formed a Doji candlestick pattern, which indicates uncertainty near all-time high level. However, the Nifty Midcap 100 and Nifty Smallcap 100 has marked fresh all-time high.

Here are the top trading set-ups to watch out for on Monday. 

Xchanging Solutions: Considering the weekly chart, the stock has given a breakout of downward sloping trendline resistance as on the weekend of July 16, 2021, and thereafter witnessed a sharp upside of nearly 52 per cent. After registering the high of Rs 141, the stock has witnessed correction along with low volume. The correction is halted near the 61.8% Fibonacci retracement level of its prior upward move and it coincides with the 20-week EMA level.

On Friday, the stock has given downward sloping trendline resistance breakout on the daily chart. This breakout was confirmed by above 50-days average volume. Friday’s volume is highest after July 23, 2021, which indicates strong buying interest by market participants. Interestingly, the slope of short and long-term moving averages is rising which is a bullish sign. The 14-period RSI on the daily timeframe is in bullish territory and on Friday, it has surged above its prior swing high. The daily MACD stays bullish as it is trading above its zero line and signal line. The MACD histogram is suggesting a pickup in upside momentum. The technical evidence indicates a strong upside in the coming weeks. The prior high of Rs 141 will act as crucial resistance for the stock. While on the downside, the zone of Rs 112-113 is likely to provide the cushion in case of any immediate decline.

Firstsource Solutions: The stock has formed a spinning top like candlestick pattern as on the weekend of July 23, 2021, and thereafter witnessed correction. The correction is halted near the 38.2% Fibonacci retracement level of its prior upward move. For the last 10 weeks, the stock is oscillating in a narrow range, which resulted in the formation of ascending triangle pattern on the daily chart. Due to the narrow range, the Bollinger band, which have developed on the basis of the last 20-days volatility, has been contracted significantly. This is an early indication of expansion in volatility.

Currently, the stock is on verge of giving a breakout of ascending triangle pattern on the daily chart. In addition, dramatically increased volume indicates that there was a good chance that the upper trendline resistance of ascending triangle would be taken out. The momentum indicators and oscillators are also supporting the overall bullish price structure. The 14-period RSI on the daily and weekly chart is in bullish territory. Furthermore, in the recent sideways to corrective mode, the RSI has taken support near the 60 mark, which indicates that the stock is in a super bullish range as per RSI range shift rules. Going ahead, in case, if the stock is sustaining above the zone of Rs 214-Rs 216, we may witness a sharp upside in the stock. On the downside, the 20-day SMA is likely to act as short-term support for the stock.

 

 

 
 

Categories