Ambuja Cement forms Homing Pigeon pattern

Ambuja Cement forms Homing Pigeon candlestick pattern on daily time frame. Homing pigeon closely resembles the harami or inside day pattern, except the both 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 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, which is currently placed at Rs. 229.35.

The indicators and oscillators are lying below 50 and tilted southward. The stochastic is in extremely oversold zone but reversal yet to confirm. In the near-term, the zone of Rs. 221- 218 is likely to act as major support as the short and long-term moving averages, i.e. 50-day EMA, 100-day EMA and 200-day EMA are placed in that region. Failure to hold this support would lead to further correction up to the level of Rs. 215, which is horizontal trendline support zone. While on the upside, Friday's high of Rs. 229.35 will be the major hurdle for the stock.

On Friday, the stock of Ambuja Cement closed at Rs. 224.15 per share, surged by 0.63 per cent. The stock opened at Rs. 223.60 per share and hit an intraday high of Rs. 227.50 and a low of Rs. 222.75 per share on BSE.