TRANSCORP: Eventually the ‘W’ shape recovery; A perfect opportunity to buy


Monday, September 7 2015, 08.30AM / Harish Shahi, The Analyst 

A closer look on the daily chart TRANSCORP reveals that earlier stock was making successive lower lows and lower highs and heading towards south side. Well, arriving at N2.00 level the bears were unable to manage their self and the bulls were making every effort to bounce back.

Even they tried earlier to spring back to N2.90 level but bears took the charge and pull the price towards downside. This time again bulls shown their strength and bounced back to upside and survived above N2.40 i.e. above all moving averages.

The recent price action seems that the bulls are in revenging mood and are not allowing the bears to move down further. The bulls have reacted at the right time as it has bounced from this level earlier also and playing as a key support level. From technical prospective, we can see that double bottom pattern is in process of formation and generating bullish signal.

The short term trend is down according to the daily swing chart and momentum appears to be in favour of an upside. A sustained move above N2.40 will signal further presence of buyers and will provide more strength to the bulls; this could trigger acceleration to the upside with N3.50 as next target.

The way bulls are reacting seems that they are approaching the N3.50 level in short term. A valid breakout of N2.50 will open the way towards the N3.50 and N4.00 level which is key resistance level for the time being.

All odds are in favor of the bulls and indicating a bullish signal. Presently, stock is trading between all major and minor EMA lines and candles are generating trend reversal signal. Both investors and traders are displaying bullish tendency towards the stock for the time being.

To View Technical and Interactive Chart with Indicators like MACD, RSI, Stochastic, Moving Average, Bollinger, Williams %R, MFI ... Click HERE

What Next?
Three consecutive bullish marabuzo and hammer candlesticks are generating bullish signal. A bullish crossover on MACD indicator is also favoring the bulls. Both RSI and CCI indicators are providing bullish signal from a positive territory.

Intraday bias remains bullish on the stock as long as N2.00 level remains intact. The N3.50 level is key resistance level followed by N4.00 whereas N2.00 can be considered as key support level followed by N1.50 level.

Trade Idea:
Based on the charts and explanation above, traders and investors can buy at N2.44 level for the target price of N3.20 and N3.60 level with the stop loss of 2.00.The tentative time frame would be 6-8 days.

NB: Return on Investment based on trade idea above does not take cognizance of brokerage commission

Related NEWS

TRANSCORP tops investors radar records 31.07 gain in 4days  - Proshare

To View Technical and Interactive Chart with Indicators like MACD, RSI, Stochastic, Moving Average, Bollinger, Williams %R, MFI ... Click HERE

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