Trent Limited meets the trend template of Mark Minervini
Since March 2020, the stock of Trend Limited is trading in a rising channel on the weekly chart (logarithmic scale). The stock has formed Shooting Star like candlestick pattern on October 14, 2021, and thereafter witnessed minor correction. The correction is halted near the lower trendline of the rising channel (demand line) and it coincides with the 20-week EMA level.
Since the last six weeks, the stock has formed a strong base near the demand line of the rising channel and initiated its northward journey. On the weekly chart, the stock has formed a bullish candle with a lower shadow.
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 355 trading sessions, the stock is trading above its 200-day moving average. Currently, the stock is trading above its 200-day SMA by 16%.
The 50-day (10-week) moving average is also above both, the 150-day as well as 200-day moving averages. The current stock price is above the 50-day moving average. Also, the current stock price is 85% above its 52-week low and currently, it is trading 10% below its all-time high.
The momentum indicators and oscillators are also supporting the overall price action. The leading indicator, 14-period weekly RSI has given a positive crossover and it is about to surge above the 60 mark. The daily RSI is currently quoting at 60.93 and it is in rising mode. The daily MACD stays bullish as it is trading above its zero line and signal line. The trend strength indicator, Average Directional Index (ADX), is at 25.67, which indicates strength. The +DI is much above the -DI. This structure is indicative of the bullish strength in the stock.
Considering the all above factors, the stock is likely to touch the upper trendline of the rising channel in near term. The upper trendline of the rising channel is currently placed at Rs 1380. On the downside, the level of Rs 970 will act as strong support for the stock.
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