Strides Pharma Science forms three inside up candle

The stock of Stride Pharma Science Limited has given a neckline breakdown of Adam & Adam double top pattern as of October 29, 2020, and thereafter, witnessed a correction. The correction is halted near the 50 per cent retracement level of its prior upward move (Rs 408.10-Rs 764.40).

On Thursday, the stock formed a reversal ‘three inside up’ candlestick pattern on the daily timeframe. The three inside up pattern represents the confirmation of the bullish harami pattern, which shows the success of the forecast. 

In this pattern, the first candle is a long bearish candle, which closes near its low. The second candle is a small bullish candle, which gaps up from the first candle and closes inside the body of the first candle thus, creating a harami pattern. The third candle exceeds the high of the first two candles.

Along with this bullish formation, the stock has also managed to close above its 50-day EMA level. Among the momentum indicators, the 14-period daily RSI has bounced back after touching the level of 31.35 and at present, its reading is 47.31. The RSI is trading above its 9-day average and it is in a rising mode, which indicates a further upside momentum. Moreover, the daily stochastic oscillator is also suggesting some bullish strength as per cent K is above the per cent D.

Going ahead, the zone of Rs 675 -Rs 678 is a crucial resistance for the stock as it is the confluence of 50 per cent retracement of its prior downward move (Rs 762-Rs 594) and the short-term 20-day EMA level. On the downside, Tuesday’s low of Rs 594 is likely to act as a major support for the stock.

On Thursday, the stock of Stride Pharma Science closed at Rs 665 per share, surged by 6.31 per cent. The stock opened at Rs 625 per share and hit an intraday high of Rs 669.60 and a low of Rs 620.60 per share on NSE.