Axis Bank forms bullish engulfing candle
The stock of Axis Bank Limited is trading in the rising channel since October 2018. After registering a high of Rs. 827.75 in the first week of June, the stock has entered into a downtrend and recorded series of lower high-low. However, considering the daily time frame, the stock had formed reversal bullish engulfing candle near lower trendline of the rising channel. The bullish engulfing candlestick pattern is considered to be a bullish reversal pattern and usually occurs at the bottom of a downtrend.
On Tuesday, the stock has managed to close above its weekly pivot and 50-day exponential moving average. The reversal is justified with relatively higher volumes. From the momentum indicators perspective, the 14-period weekly RSI is currently quoting at 48.90 and it has given positive crossover. The stochastic oscillator is also suggesting some bullish strength as %K is above the %D.
Going ahead, if the stock sustains above Tuesday’s session high of Rs. 783 and trades convincingly above this level, then there is a high probability that Tuesday’s lowest point of Rs. 756.55 would become a temporary bottom for the stock.
On Tuesday, the stock of Axis Bank closed at Rs. 780.10 per share, surged by 2.26 per cent. The stock opened at Rs. 761.25 per share and hit an intraday high of Rs. 783 and a low of Rs. 756.55 per share on NSE.