Bajaj Finserv forms bullish engulfing candle

The stock of Bajaj Finserv Limited has formed a bullish engulfing candle on the daily scale. The bullish engulfing candlestick consists of two real bodies of opposite colours. The second day’s body completely engulfs the previous day's body. A large bullish candle suggests this was a sudden and decisive shift to bullish sentiment.

On Friday, the stock has managed to close above its 200-day EMA. The reversal is justified with relatively higher volumes. From a momentum oscillator perspective, the 14-period daily RSI is currently quoting at 38.52, and it has recently given positive crossover. The stochastic oscillator is also suggesting some bullish strength as %K is trading above the %D.

Going ahead, if the stock sustains above Friday’s session high of Rs. 7,298 and trades convincingly above this level, then there is a high probability that Friday’s lowest point of Rs. 6,631.70 would become a temporary bottom for the stock.

On Friday, the stock of Bajaj Finserv closed at Rs. 7,279.90 per share, surged by 7.33 per cent. The stock opened at Rs. 6,775 per share and hit an intraday high of Rs. 7,298 and a low of Rs. 6,631.70 per share on NSE.