Siemens retests rounding bottom breakout with good volumes

Siemens, a global powerhouse that is engaged in electrification, automation and digitisation, retested a significant Rounding bottom breakout at 1293 levels on a closing basis. During the week the company bagged Gujarat Metro Link Express contract for consideration of Rs. 580 crores. 

The stock of Siemens surged 1.8 per cent on closing basis after two consecutive days consolidation with 2.71 times spurt in volumes. Earlier after hitting a triple bottom nearly at 1125 levels the stock gave almost a straight upside up to 1293 levels. 

The stock had attempted a rounding bottom breakout on January 9, but witnessed a pullback and witnessed a slight correction of up to 1281 i.e. near to 38.2 per cent retracement of the prior upward rally. The 1281 level also acted as 8-day EMA support level for the stock. On Friday, the stock bounced back confirming the breakout at 1293 levels. 

Apart from justifiable volumes, the 14-period RSI has given multiple point downward sloping trendline breakout at 62 levels and has now surged and entered over bought zone. The stock has a tendency to give potential upside even in the overbought zone and hence, with or without a pullback the stock may give 120-130 points upside from current levels in medium term.