Technical Bits: Hexaware Tech forms Homing pigeon candlestick pattern

Hexaware Technologies Limited forms Homing Pigeon candlestick pattern on the daily time frame. Homing pigeon closely resembles the harami or inside day pattern, except that both the bodies are red rather than opposite in colour. The pattern may indicate that there is a weakening of the current downtrend, which increases the likelihood of reversal. However, the confirmation of the pattern is required on the third candle. The third candle has to close above the high of the first candle to trigger a buy signal.

The indicators and oscillators are lying below 50 level. There has been a bullish divergence between the Daily RSI, Daily Stochastic and stock price movement, which suggests limited downside. Going ahead, it’s important for the stock to sustain and close above the first candles high which is placed in the region at Rs. 348. A sustainable move above the level of Rs. 348 is likely to open up gates for further rally towards levels of Rs. 365. While on the downside, the level of Rs. 328-Rs 330 is likely to act as short-term support as the downward sloping trendline is placed in that region.

On Monday, the stock of Hexaware Technologies Ltd closed at Rs. 340.25 per share, surged by 0.90 per cent. The stock opened at Rs. 337.30 per share and hit an intraday high of Rs. 342.85 and a low of Rs. 336.90 per share on BSE.