Bata India gives breakdown of rising wedge pattern

The stock of Bata India Limited has given a breakdown of rising wedge pattern on the daily time frame. This breakdown was confirmed by the above 50-day average volume. The rising wedge is a bearish pattern that begins wide at the bottom and contracts as the prices move higher and the trading range narrows.

With this pattern breakdown, the stock has also managed to close below its weekly pivot and short-term moving averages, i.e. 13-day EMA and 20-day EMA. The relative strength index (RSI), which is a momentum indicator in the daily timeframe, turned down from 60-mark and in the bear market, we have seen that the RSI does not move above 60-mark. Moreover, the daily stochastic oscillator has also given a negative crossover.

Going ahead, we expect the bias to remain bearish as long as the stock sustains below Monday’s high of Rs 1,337.95 level. On the lower side, the level of Rs 1,242, followed by Rs 1,196, would be seen as the next support for the stock.

On Monday, the stock of Bata India closed at Rs 1,279.90 per share, dipped by 4.13 per cent. The stock opened at Rs 1,335 per share and hit an intraday high of Rs 1,337.95 and a low of Rs 1,273.05 per share on NSE.