Havells India: After consolidation, uptrend begins

After seven days of consolidation, the stock of Havells India registered a breakout with strong volume on Tuesday. The stock opened with a minor gap down, but later we witnessed a nice upmove in Havells. We have seen volume pick up in the first half. Inside day pattern in last week's chart suggests a pause in short-term trend, after a pause the original uptrend began on Tuesday.

Indicators and oscillators also broke the consolidation range in daily time frame which suggests further upside momentum. From October 26, the stock price has been above its short-term 21 days simple moving average. As long as prices stay above the mentioned crucial short-term moving averages, the stock may extend its up move.

Options data suggests highest open interest in 680 and 700 CE option, so this will act as a resistance and 640 PE option is having highest open interest, this will work as short-term support. Daily chart suggests in the coming days, the levels of Rs. 635-640 is likely to act as an important support zone, below this levels the short-term trend may change, however, there is an immediate hurdle for the stock placed in the region of Rs. 672 to 680, the stock may witness breather around these levels. A follow-through move above this resistance zone may take the stock towards the level of Rs. 700 followed by Rs. 720 in the short-medium term.