Hindalco Industries forms Tri-Star bottom reversal like pattern
The stock of Hindalco Industries Limited has formed a Tri-Star bottom reversal like pattern. The formation of the pattern is not exactly according to the textbook rules as the middle day candle has a minor body. It should be noted that the textbook perfect Tri-Star pattern is very rare.
The Tri-Star bottom reversal pattern is made up of three Doji days, with the middle day being a star. The first Doji would cause a considerable concern while the second Doji would indicate that there was no direction left in the market. And finally, the third Doji would put the final nail in the coffin of the trend. Since this indicates too much indecision, everyone with any conviction would be reversing positions.
Among the momentum indicators, the daily strength indicator, RSI has bounced back from the level of 34 and currently, trading below its 9-day average thereby, indicating an absence of strength. However, the momentum oscillator, daily stochastic has given a positive crossover, indicating an upside momentum. Further, the downside momentum is fading as the MACD histogram is increasing since the last seven trading sessions.
Going ahead, the stock has immediate support in the zone of Rs 157.50-Rs 154.50. While on the upside, Friday’s high of Rs 164.85 will be the immediate hurdle for the stock. A decisive breach on either side may result in a trending move.
On Friday, the stock of Hindalco Industries closed at Rs 162.05 per share, surged by 1.85 per cent. The stock opened at Rs 161.95 per share and hit an intraday high of Rs 164.85 and a low of Rs 157.65 per share on NSE.