RATNAMANI trades in symmetrical triangle pattern

The stock of Ratnamani Metals & Tubes Limited has formed a Reversal Spinning Top candlestick pattern as on weekend of January 05, 2018, and, thereafter, entered into the corrective phase. The correction is halted at the 50 per cent Fibonacci retracement level of its last upward move, which started from the low of Rs. 396.40 to its all time high level. However, considering the weekly time frame, the stock is trading in symmetrical triangle pattern. As of now, the price action has narrowed, substantially, and the price has reached near the apex point of the triangle, which indicates that the stock is likely to give a breakout in the coming weeks. 

The symmetrical triangle can be a continuation or a reversal pattern. Although more often, it is a continuation pattern.

The major trend of the stock is bullish, as it is trading above its weekly pivot and above its long-short term moving averages, that is, 20-week, 50-week, 100-week, and 200-week EMAs and these moving averages are exactly in an ascending order, which suggests that the trend is strong. Last three weeks, the volumes recorded were above 50-week average, which is a sign of accumulation. The leading indicator, 14-period weekly RSI, is currently quoting at 60.73 and it is trading above its 9-week average. The weekly MACD stays bullish, as it is trading above the zero line and signal line. The histogram is suggesting that the momentum is picking up.

Going ahead, the zone of Rs. 1,000-Rs. 1,010 is likely to act as an immediate hurdle for the stock as upper trendline of Triangle pattern is placed in that region. While on the downside, the stock has immediate support in the zone of Rs. 950-Rs. 930 as it is the confluence of short term moving averages. that is, 20-week EMA and 50-week EMA level, while the major support is placed in the zone of Rs. 900-Rs. 890, as upward sloping trendline and 100-week EMA is placed in that region.