FDC surge over 8 per cent; forms bullish opening Marubozu candle

Considering the daily timeframe, the stock of FDC Limited has formed a bullish opening Marubozu candle near the upward sloping trendline support, which coincides with the 100-day EMA level. This suggests that the bulls are taking control near the medium-term support. The reversal from the support is further justified with above 50-day average volumes.

The opening bullish Marubozu candle has no shadow extending from the open price end of the body. Opening bullish Marubozu candle indicates an extreme bullishness. It is being expected that the sudden change in sentiment will be carried forward over the next few trading sessions and hence, traders should look for buying opportunity.

The stock is meeting Daryl Guppy’s multiple moving averages set-up rules as it is trading above both the short and long-term moving averages. The positive crossover on 14-period RSI and stochastic supports the overall bullish price structure. Further, the daily ADX is very strong at 32.20. The -DI is below +DI and ADX is above -DI and +DI. This shows a technical strength in the stock. 

Going ahead, the 50-day EMA is likely to act as immediate support for the stock, which is currently placed at Rs 252.20 level. Besides, the zone of Rs 241-Rs 236 is likely to act as major support since it is a confluence of upward sloping trendline support and a 100-day EMA level. On the higher side, any sustainable move above the level of Rs 274.50 is likely to open up gates for further rally towards the levels of Rs 282, followed by Rs 298. 

On Tuesday, the stock of FDC closed at Rs 261.15 per share, surged by 8.86 per cent. The stock opened at Rs 236.60 per share and hit an intraday high of Rs 265.50 and a low of Rs 236.60 per share on BSE.