Technical Bits: Marico gives symmetrical triangle breakout

The stock of Marico has given symmetrical triangle breakout on the weekly time frame. This breakout was confirmed by the above 50-week average volumes. Additionally, the stock formed a sizeable bullish candle on the breakout week, which adds strength to the breakout.

The major trend of the stock is bullish as it is trading above its weekly pivot and above its long-short term moving averages, i.e. 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. Interestingly, the weekly RSI has also broken out of a symmetrical triangle pattern, which is a very bullish sign. The weekly stochastic oscillator is also suggesting some bullish strength as %K is above the %D. Moreover, the other volume-based indicators like OBV and MoneyFlow index are also very strong.

Going ahead, the zone of Rs. 394-Rs. 396 is likely to act as an immediate hurdle for the stock, a follow-through move above this level would lead to an extension of the pull-back toward Rs. 415, followed by Rs. 445. While on the downside, the 20-day exponential moving average is likely to as short-term support, which is currently placed at Rs. 372.50 level.

On Friday, the stock of Marico closed at Rs. 392.70 per share, surged by 2.51 per cent. The stock opened at Rs. 385 per share and hit an intraday high of Rs. 393.70 and a low of Rs. 383.50 per share on BSE.