CDSL gives trendline breakout

Considering the daily chart, the stock of Central Depository Services (India) Limited has given a downward sloping trendline breakout, formed by connecting swing highs since December 2020. This breakout is confirmed by the above 50-day average volume. Further, the stock has formed a sizeable bullish candle on the daily chart.   

Currently, the stock is trading above its 20-day EMA (514.90), 50-day EMA (509.50), 100-day EMA (484.55) and 200-day EMA (428.40), which indicates a medium and long-term uptrend.   

The stock's relative strength index (RSI) has reached its highest value in the last 14-days, which is bullish. Also, it has managed to close above the 60 mark after a span of almost 23 trading sessions. The MACD is above the zero line and signal line. The MACD histogram suggests bullish momentum. And most importantly, the MACD line crossed the prior swing highs. On the daily timeframe, the ADX is 14.37 and suggests that the trend is yet to be developed. The directional indicators continue in the ‘buy’ mode as +DI continues above the –DI.  

Going ahead, we expect the bias to remain positive as long as the stock sustains above its 20-day EMA level, which is currently quoting at Rs 514.90 level. On the higher side, the level of Rs 551, followed by Rs 566.40 would be seen as the next resistance zone for the stock.     

On Friday, the stock of Central Depository Services (India) surged 3.78 per cent and closed at Rs 538.05 per share. The stock opened at Rs 520.35 per share and hit an intraday high of Rs 540 and an intraday low of Rs 517.10 per share on NSE.