IEX bounces from trendline support; can northward journey resume?

For the last 103 trading sessions, the stock of Indian Energy Exchange was trading in an upward sloping channel. Recently, the stock has bounced exactly from the edge of the lower trendline of the rising channel. The rising trendline support was a confluence with the 100-day SMA level. The reversal from trendline support was further justified by the above 50-days average volume.     

The stock has also surged above its short-term 20-day EMA. Further, the 20-day EMA has started edging higher, which is a bullish sign.   

The momentum indicators and oscillators are also supporting the overall bullish price structure. The leading indicator i.e. the 14-period daily RSI took support in the zone of 42-45 level historically many times and this time also, it bounced exactly from the same zone. Currently, the RSI has surged above the 60 mark and it is in a rising mode. The +DI has just crossed above the -DI and ADX. This structure indicates the strengthening of the uptrend. Moreover, the downside momentum is fading as the MACD histogram is rising since the last three trading sessions.     

Going ahead, the 20-day and 50-day EMA are likely to act as an immediate support while a major support is placed in the zone of Rs 391-Rs 385 level. On the upside, the upper trendline of the rising channel is likely to act as crucial resistance, which is currently placed in the zone of Rs 467-Rs 470 level.     

On Tuesday, the stock of Indian Energy Exchange Ltd surged 3.41 per cent and closed at Rs 430.70 per share. The stock opened at Rs 420 per share and hit an intraday high of Rs 432.80 and a low of Rs 415.60 per share on NSE.