Top swing trading stock to watch: Hindalco Industries breaks out of Cup and Handle pattern!

This structure is indicating the bullish strength in the stock.

The Indian benchmark indices opened with a gap-down amid global uncertainty. However, as the day progressed, the indices have managed to recoup the bulk of their losses and were seen trading near the day’s high. Nifty has recovered almost 270 points from the day’s low and was seen trading above the 16,600 mark.   

India VIX also cooled off from the day’s high as at one point in time, it was seen inching closer to the 30-mark and is currently, trading at the 28.4 mark.   

Amidst all this volatility, one sector that is seen buzzing on D-Street is Nifty Metal. Nifty Metal index has gained nearly 3 per cent on Monday. Meanwhile, one of the top-performing stocks in this sector is Hindalco Industries. The stock has jumped over 4 per cent on Monday and also, hit a fresh all-time high of Rs 559.30. With this strong upmove, the stock has witnessed a breakout of the Cup & Handle pattern.   

As the stock is trading at an all-time high, it is above all the short and long-term moving averages. The stock is also meeting Mark Minervini’s trend template. It is trading above 40, 30 & 10-weekly averages and all of them are trending up. At the same time, there is the desired sequence. It is also meeting Daryl Guppy’s multiple moving averages (GMMA). This structure indicates that the stock is in a clear uptrend.   

The other trend strength indicator i.e. the average directional index (ADX) is at 20.09, which shows further strength. The +DI is much above the –DI while the former is trending up. This structure is indicating the bullish strength in the stock.