Lincoln Pharmaceuticals gives trendline breakout
The stock of Lincoln Pharmaceuticals Limited has given a horizontal trendline breakout, formed by connecting swing highs since March 2018. Further, the breakout is supported by a robust volume of more than double of 50-day average volume, indicating a strong buying interest by the market participants.
The major trend of the stock is bullish as it is trading above its weekly pivot and above its long and short-term moving averages, i.e. 20-day, 50-day, 100-day, and 200-day EMAs and these moving averages are exactly in an ascending order, which suggests that the trend is strong. The stock is also meeting Daryl Guppy’s multiple moving averages set up rules.
Among the momentum indicators, the 14-period RSI is in a rising trajectory in both the weekly and the daily timeframe. The daily RSI has also managed to close above its prior swing high, which is a bullish sign. The daily MACD stays bullish as it is trading above its zero line and signal line. The histogram is suggesting a pickup in the upside momentum.
Moreover, the trend strength indicator, average directional index (ADX), is at 38.36, which indicates strength. The +DI is much above the -DI. This structure is indicative of bullish strength in the stock.
Going ahead, the stock has immediate support in the zone of Rs 209-Rs 203 as the short-term moving averages i.e. 8-day EMA and 13-day EMA are placed in that region. While the major support is placed in the zone of Rs 187-Rs 185 as it is a confluence of upward sloping trendline support and short-term 34-day EMA level. On the higher side, the level of Rs 245, followed by Rs 255, would be seen as the next resistance zone for the stock.
On Monday, the stock of Lincoln Pharmaceuticals closed at Rs 226.30 per share, surged by 6.24 per cent. The stock opened at Rs 214.90 per share and hit an intraday high of Rs 229.75 and a low of Rs 213 per share on NSE.