When a stock is in strong uptrend, then one should follow the stock and how it behaves around moving averages
Om Metal Infra stock has been in strong uptrend. The stock from levels of 30 has rallied to 60 in less than 4 months. And it's quite interesting how stock has consistently found support on every small decline in its upward journey.
Here's the daily chart
As you can see in the chart above: the stock has always found support at 50 dma in last few months. The stock is once again at 50 dma and one can hope of another decent bounce in the stock.
What does this mean?
Technically, stock is expected to keep doing what it has been doing. It means stock can deliver strong bounce from current 50 dma levels. Any decline below 50 dma will open up the stock for deeper decline and longer correction.
Please share your comments on what you think of stock observations, market and trading in general. Please do your own due diligence before trading or investment. Do not treat the above as any recommendation.
1. BEML = Breakout and Pullback
2. Is Rallis building base at 205?
3. How Unichem Labs stock is shaping up on Chart?
4. Can Fortis find support around current levels?
5. Natural Gas Price now near $2 - Dramatic collapse in 2015
Do you like reading Stock Observations and don't want to miss it - then Like our Facebook Page. Market Observations will show up on your facebook timeline.
Disclaimer – The state of the market notes is Deepak’s perspective on the market. The column is purely for educational purpose. Nothing contained herein is a solicitation to trade or a recommendation of a specific trade. By reading this publication you agree to make no trade relying in whole or in part on the comments of the writers