Is Container Corporation a good buy? Here's a technical breakdown
Container Corporation of India Limited is engaged in the transportation and handling of containers, which also involves the operation of logistics facilities, container freight stations and private freight terminals.
On Friday, the stock has skyrocketed nearly 12% and with this, on the weekly chart, it has registered a breakout of downward sloping trendline formed by adjoining swing high from September 2021. Moreover, the stock has formed a Bullish Marubozu candlestick pattern, Marubozu is a Japanese term for dominance and this candle is extremely powerful as it has a long body with small or no shadow. On the volume front, the stock has witnessed the highest single-day volume since May 24, 2021. Furthermore, what’s striking is the fact the stock has witnessed a volume of more than 7 times of 50-days average volume, indicating strong buying interest by market participants.
The 14-period Relative strength indicator (RSI) is above 70. It has crossed above its prior high and is in a rising mode. The MACD line is trading above its signal line and zero line which indicates a positive trend in the stock. In addition to this, the MACD line is above the zero line since March 10. The directional movement index is also at a strong point. Directional indicators continue in the ‘buy’ mode as +DI continues above –DI.
As the stock has made a fresh multi-month high, it is trading above its all short-term and long-term moving averages. This setup is indicating a clear uptrend. Meanwhile, the scrip is up by 14% on an MTD basis while on a YTD basis, it is up by 12.64%.
The stock is expected to test the level of Rs 753, which is its all-time high followed by the level of Rs 800, which may act as the next phycological resistance. Meanwhile, on the downside Rs 619 (it is a 50-DMA).
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