This Pharma stock meets the trend template of Mark Minervini
The stock of GlaxoSmithKline Pharmaceuticals Limited has formed a hammer candlestick pattern as on the weekend of March 13, 2020, and thereafter marked the higher tops and higher bottoms on the weekly chart. From the low of Rs 962.65, the stock has gained over 95% in 91 weeks.
In the current week, the stock has given symmetrical triangle pattern breakout on the weekly chart. Since the last six weeks, the volumes recorded were above the 50-week average, which is a sign of accumulation. Additionally, the stock has formed a sizeable bullish candle on breakout week.
Currently, the stock is meeting the criteria of Mark Minervini's Trend Template. The current market price of the stock is above the 150-day (30-week) and the 200-day (40-week) moving averages. The 150-day moving average is above the 200-day moving average. Since the last 27 trading sessions, the stock is trading above its 200-day moving average. The stock is trading above its 200-day SMA by over 23%.
The 50-day (10-week) moving average is also above both 150-day and 200-day moving averages. The current stock price is above the 50-day moving average. Also, the current stock price is nearly 37% above its 52-week low and currently, it is trading at a 52-week high. Its Mansfield Relative Strength (1.35) is above the zero line thereby, indicating the outperformance compared to the broader index i.e. Nifty 500. The Mansfield Relative Strength indicator is above the zero line for the last 12 trading sessions.
Interestingly, the weekly RSI has given a horizontal channel breakout, which is a bullish sign. The fast stochastic is trading above its slow stochastic line. The stock is clearly on uptrend and trend strength is extremely high. The Average Directional Index (ADX), which shows trend strength, is as high as 42.47 on a daily chart and 38.22 on a weekly chart. Generally above 25 levels considered as the strong trend. In both time frames, the stock is meeting the criteria.
Talking purely about the trading levels, the prior all-time high of Rs 1936 will act as crucial resistance for stocks, and the level of Rs 1800-Rs 1770 will act as crucial support.
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