Hero Motocorp surges 3 per cent, breaches trendline level
Hero Motocorp which holds 8.8 per cent weightage in Nifty Auto index and also forms a part of Nifty50 surged 3 per cent from its previous close. The stock opened on a positive note and consolidated during afternoon trade followed by a gradual but consistent upside till closure. Overall Nifty Auto index traded on a positive note tracking positive cues from Tata Motors’ February wholesale numbers. Further Hero Motocorp’s launch of Super Splendor in the last week kept the momentum on.
Technically, Hero Motocorp has been making lower tops since September 1, 2017. With this the stock has formed a multiple point downward sloping trendline on the daily time frame. The stock witnessed bottom finishing at 3,410 on December 13, 2017. Thereafter, it attempted a trendline breakout thrice, but failed every time.
Recently, the stock broke its major resistance at 3620-3625 levels and also hit above its trendline level 3685 levels on closing basis. On Monday, stock also closed above its 50 days, 100 days and 200 days EMA resistance levels. The 14-period RSI witnessed a trendline breakout at 52 levels and surged as much as 64 in Monday’s trade. Volumes too remained justifiable.
Going forward, the stock may see a positive rally which would be confirmed once the stock breaks its major resistance at 3750-3753 levels on a closing basis.