Dabur India forms Doji candle on weekly scale

Dabur India Limited has formed a Doji candle after forming a sizeable bullish candle in the weekly time frame. This suggests that the bulls are tired. However, in the next week we may get confirmation of a near-term reversal. Considering the daily time frame, stock had formed Bearish engulfing candle on Friday, which suggest in short term bears are in dominant position.

 The Doji is a single candlestick pattern that indicates weakness and a potential trend reversal. A doji is usually a relatively short candlestick with no real body or very little real body. In terms of market psychology, a Doji indicates that there is indecision and uncertainty in the market with neither buyers nor sellers able or willing to move the price to significant levels. However, it requires a confirmation on the next trading day.

 The 14-period RSI is currently quoting at 61.64, and on Friday it has given a negative crossover. The fast stochastic is trading below slow stochastic, which is negative for stock.

 In the near-term, Doji candle’s high is likely to act as strong resistance, which is currently placed at Rs. 464.20. A follow-through move above this level would lead to an extension of the pull-back toward Rs. 475, followed by Rs. 490. While on the downside, 21-day EMA is likely to act as strong support, which is currently quoting around Rs. 438.75, failure to hold this support would lead to further correction up to the level of Rs. 415.