AKZOINDIA forms bullish belt hold pattern

The stock of Akzo Nobel India Limited has formed a bullish belt hold candlestick pattern on the daily time frame, which signals a shift in the sentiment from bearish to bullish. The bullish belt hold is a single candlestick pattern that suggests a possible reversal to the upside.

The bullish belt hold candle is similar in appearance to a bullish opening-Marubozu candle that occurs in a downtrend. The market is trending when a gap in the direction of the trend, occurs on the open. From that point, the market never looks back: All further price action that day is the opposite of the previous trend. This causes much concern and many positions will be covered or sold, which will help accentuate the reversal.

Among the momentum indicators, the 14-period RSI has bounced back after hitting the 31 level and currently, quoting at 43 level. The daily stochastic has given a positive crossover. Moreover, the positive divergence is clearly visible between the daily stochastic and stock price movement, which suggests limited downside.

In near-term, the zone of Rs 2,175-2,210 is likely to act as an immediate resistance. A decisively close above this level would lead to an extension of the pullback towards Rs 2,275, followed by Rs 2,410. While on the downside, the zone of Rs 1,960-1,914 is likely to act as a major support. 

On Friday, the stock of Akzo Nobel India closed at Rs 2,143.30 per share, surged by 8.25 per cent. The stock opened at Rs 2,000 per share and hit an intraday high of Rs 2,189 and a low of Rs 1,970.55 per share on BSE.