Technical Bits: TCS forms Three Inside Up candlestick pattern

The stock of Tata Consultancy Services (TCS) has formed a Three Inside Up candlestick pattern on the weekly scale. The Three Inside Up pattern is representing 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.

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. The leading indicator 14-period weekly RSI is currently quoting at 57.61 and it is trading above its 9-week average. The weekly stochastic oscillator is also suggesting some bullish strength as %K is above the %D.

Going ahead, the stock has immediate support in the zone of Rs. 2,150-2,160 as the 20-day EMA and 50-day EMA is placed in that region, while the major support is placed in the zone of Rs. 2,070-Rs. 2,050 as it is the confluence of 200-day EMA and the upward sloping trendline support. On the higher side, any sustainable move above the level of Rs. 2,220 is likely to open up gates for further rally towards the levels of Rs. 2,250, followed by Rs. 2,290.

On Friday, the stock of Tata Consultancy Services closed at Rs. 2,206.05 per share, surged by 1.20 per cent. The stock opened at Rs. 2,179.90 per share and hit an intraday high of Rs. 2,210 and a low of Rs. 2,166.40 per share on BSE.