Technical Bits: Powergrid gives trendline breakout

The stock of Power Grid Corporation of India has given downward sloping trendline breakout on the weekly scale formed by connecting swing highs from August 2017. This breakout was confirmed by the above 50-week average volumes. Additionally, the stock formed a sizeable bullish candle on 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-day, 50-day, 100-day and 200-day EMAs. These moving averages are exactly in an ascending order, which suggests that the trend is strong. The 14-period weekly RSI on the weekly chart is in the rising trajectory, which suggests bullish bias.

The stochastic oscillator is also suggesting some bullish strength as %K is above the %D. Moreover, the ADX is very strong at 27.15. The -DI is much below the +DI. This shows technical strength in the stock.

Going ahead, the stocks need to sustain above the zone of Rs. 210- 212 for the bullish momentum to continue. On the downside, the current week’s low of Rs. 197.55 is likely to act as crucial support for the stock.

On Friday, the stock of Power Grid Corporation of India closed at Rs. 205.90 per share, dipped by 0.87 per cent. The stock opened at Rs. 207.15 per share and hit an intraday high of Rs. 209.60 and a low of Rs. 204.65 per share on NSE.