Indiabulls Housing forms Evening Doji Star pattern

The stock had witnessed multiple touch point downward sloping trendline breakout at Rs. 750 on March 27, 2019 and thereafter stock had seen almost 22 per cent upward move. At present, the stock had formed Evening Doji Star candlestick pattern.

 It is a reversal candlestick pattern which is bearish in nature and appears at the end of an uptrend. It is a complex pattern made of three candles. The first candle is bullish in nature, the second is indecisive in nature and the third candle is bearish in nature.

 The 14-period day RSI is quoting at 65.47 and it has recently given negative crossover. The stochastic has also given negative crossover, which suggests pause in the uptrend. Moreover, there has been a negative divergence between the daily stochastic and the stock price movement, which suggest limited upside. The Ichimoku chart on 60-minute timeframe is clearly giving a negative view as it closed below the KS and TS lines. Another important aspect is the KS line crossed under the TS line, which is also a bearish sign.

 In the near term, the zone of Rs. 820- Rs 795 is likely to act as major support as short-term moving averages, i.e. 13-day EMA and 20-day EMA is placed in that region. Failure to hold this support would lead to further correction up to the 50-day EMA, which is currently placed at Rs. 755. While on the upside, Friday's high (doji candles high) of Rs. 919.40 will be the major hurdle for stock.

 On Monday, the stock of Indiabulls Housing Finance closed at Rs. 858.90 per share, dipped by 4.90 per cent. The stock opened at Rs. 887 per share and hit an intraday high of Rs. 916.30 and a low of Rs. 853.10 per share on BSE.