Siemens gives downward channel breakout

Considering the weekly time frame, the stock of Siemens Ltd is trading in downward sloping channel since August 2015. On Monday, the stock has given breakout of downward sloping channel along with strong volumes. Additionally, the stock formed a sizeable bullish candle on the breakout day, 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 and these moving averages are exactly in an ascending order, which suggests that the trend is strong. The 14-period daily RSI is currently quoting at 81.85 and it is in super bullish zone. The daily MACD stays bullish as it is trading above its zero line and signal line. The histogram is suggesting that the upside momentum is picking up. Moreover, the daily ADX is very strong at 28.19. The -DI is much below the +DI and ADX is above the -DI. This indicates the strong momentum in the stock.

Going ahead, the zone of Rs. 1370-Rs. 1350 will act as an important support zone and as long as stock holds above this zone, every dip should be utilised to initiate long positions. On the higher side, the level of Rs. 1450, followed by Rs. 1510, would be seen as the next resistance zone for the stock.

On Monday, the stock of Siemens closed at Rs. 1445.10 per share, up by 8.86 per cent. The stock opened at Rs. 1340 per share and hit an intraday high of Rs. 1459.35 and a low of Rs. 1340 per share on BSE.