Just Dial forms Hammer candlestick pattern

Considering the weekly scale, the stock of Just Dial Limited has formed Hammer candlestick pattern near upward sloping trendline support and it coincides with the 100-week EMA, suggesting bulls are taking control near the long term support.

The Hammer candlestick pattern is a bullish reversal candlestick pattern that mainly occurs at the bottom of a downtrend trend. It is considered a strong formation because the bulls were able to push back the bears completely plus the bulls are able to push the price past the opening price as well.

Along with this bullish formation, the stock has also managed to close above its weekly pivot and the short term moving averages, i.e. 8-day EMA and 13-day EMA. Among the momentum indicators, the 14-period daily RSI is currently quoting at 45.90 and it is trading above its 9-day average. The daily stochastic oscillator is also suggesting some bullish momentum as %K is above the %D. Moreover, the positive divergence is clearly visible between daily RSI, daily stochastic and stock price movement, which suggests limited downside.

Going ahead, if the stock moves above the Friday session's high of Rs 636 and trades convincingly above this level, then there is a high probability that the previous weeks low of Rs 572.10 would become a temporary bottom for the stock.