TATAGLOBAL forms Bearish Engulfing pattern

The stock of Tata Global Beverages Limited has formed a Bearish engulfing candlestick pattern on the daily timeframe. This pattern is considered to be a bearish reversal pattern and usually occurs at the top of an uptrend.

With this bearish formation, the stock has also managed to close below its weekly pivot. Among the momentum indicators, the 14-period RSI, has given a negative crossover and currently, it is quoting at 60.83. The RSI is showing a negative divergence on the daily chart. Interestingly, the price has made three higher highs in recent times but most of the indicators, including the RSI, have not reached near the prior highs. The CCI has also supported the same phenomenon. Moreover, the momentum indicator MACD line has passed under the signal line, which resulted in the histogram turning negative.

Going ahead, the stock has immediate support in the zone of Rs 316-Rs 313, as it is the confluence of upward sloping trendline and short term moving averages, that is, 13-day EMA and 20-day EMA. While on the upside, Friday's high of Rs 330.05 will be a major hurdle for the stock.

On Monday, the stock of Tata Global Beverages closed at Rs 322.90 per share, dipped by 1.57 per cent. The stock opened at Rs 329 per share and hit an intraday high of Rs 329.40 and a low of Rs 320.55 per share on the NSE.