Apollo Hospitals gives bullish flag pattern breakout
On Tuesday, the stock of Apollo Hospitals Enterprise Limited has given a breakout of the bullish flag pattern. The height of the bullish flag pole is nearly 760 points. This breakout was confirmed by the above 50-day average volume. Further, the stock has formed an opening bullish Marubozu candlestick pattern on the breakout day, which indicates extreme bullishness.
The flag pattern is a short-term trend continuation pattern that marks a small consolidation before the previous move resumes. A flag is composed of an explosive strong price move that forms the flagpole, followed by an orderly and diagonally symmetrical throwback, which forms the flag. When the upper trendline resistance of the flag breaks, it triggers the next leg of the trending move.
Currently, the stock is trading above its short and long-term moving averages. These averages are in the rising mode, which is a bullish sign. Further, the stock is meeting Daryl Guppy’s multiple moving averages set-up rules.
As the stock is trading at its all-time high level, all the major indicators are suggesting bullish momentum. The 14-period daily RSI has given a positive crossover in the bullish territory. The MACD is above the zero line as well as the signal line. The MACD histogram suggests bullish momentum. And most importantly, the MACD line crossed the prior swing highs.
Moreover, the trend strength is very strong as ADX is above 50, and it is also above the +DMI & -DMI. The +DMI is trading above -DMI for the last 45 trading sessions.
Technically, all the factors are currently aligned in support of the bulls. Hence, we would advise the traders to be with a bullish bias. On the downside, the 8-day EMA level is likely to act as immediate support for the stock, which is currently placed at Rs 4,758.45 level. Besides, the prior swing low of Rs 4,646 is likely to act as crucial support for the short term while on the upside, the level of Rs 5,378 may act as crucial resistance for the stock.