Positional – Buy BAJAJ HOLDING above 840 {closing basis} sl 745 target 940-1030
holding period 3-6 month.
enter above given level if close confirm, short term trader can trade for 40-80 target also.
Technical chart study –
just look at the BAJAJ HOLDING chart, we can see a GAP on chart in a month of February, and just see it has feel up this gap in next 3 month with the consolidation and given a sharp fall from there. now moving to the current position of chart, stock has created a DESCENDING TRIANGLE pattern on longer time frame {in last 1year} and recently took support at down line of triangle to we can expect a up move in stock above given level, which can try to touch the upside resistance level in coming time to complete this pattern.
in last 2 month charts we can see that it has created ASCENDING TRIANGLE chart pattern {in smaller time frame} and today on 29/7/2013 able to give close above its resistance level, so one more positive bar above the current high level can confirm the pattern, and according to triangle width {almost about rs. 70} it can give the upper targets till 900-910 levels after a confirmation, which the resistance level of a bigger triangle which we mention before.
have a clear look at the RSI, many things to spot there, recently it moved out of oversold zone now, which can indicate that stock looking for its preceding trend reversal now, other things we can see is rsi slightly able to move above its resistance level as per the price chart, so one more upside confirmation in RSI can clear the picture for its upside movement till the overbought zone in RSI.
At its recent bottom we can spot that it has made the “POSITIVE CONVERGENCE” signal, where stock made new bottom but indicator fail for it. and this convergence is very well confirm now with the stock movement at present, but with regards with the other indicator and other pattern for more up move it need a more confirmation now above our given level.
Observe the bollinger bands now, after riding the band downside in last 3 month and after a consolidation in last 1 month stock able to break the bollinger band resistance now and able to move above this in last 2 session, so more positive close on chart can confirm the “BOLLINGER BAND RIDING UPSIDE” in coming days.
Stock also able break and able to close at its 50 days moving average which is at 828 level now, average still need upside move which can confirm the trend of the stock.
with the recent price action in chart we can see that stock has able to move above its last 33 trading session’s high and given a new high on chart today on 29/7/2013, which can also indicate that, despite a volatile market in last 3 months stock still performing well oppose to the market movement and this shows the position builder in stock at present, but timely action can be confirm by the price level itself, so give time to price and it will give you a better returns.
finally we conclude that if stock able to give close above our desire level then we can surly see the action in this one in coming days, trade according to level, know your risk then only invest, short term traders can keep booking gains on every move.