UBCAP: Potential rounding bottom pattern; A buying opportunity


Tuesday, August 11 2015 08.08 AM / Harish Shahi, The Analyst 

A closer look on the daily chart of UBCAP reveals that stock was falling down and making successive lower lows and lower highs. The bears had taken charge from N1.80 level to N1.30 level which is a strong key support level as it has received panic demand from this level two times earlier. Probability of triple bottom pattern is very high.

If we look on the daily technical chart then we can observe that after arriving at N1.30 level potential rounding bottom pattern is in process of formation which is adding some bullish flavor. Well, this is an early buy call we will get further bullish signal above N1.50 level. If bull’s trades and settles above N1.50 level then it will open the way towards the N1.80 level in short term.

There may be a lot of demand in the market and N1.30 continued to be a very strong support. The short term trend is down according to the daily swing chart, and momentum appears to be favour to the upside. A sustained move above N1.5.0 will signal the presence of buyers and will provide more strength to the bulls; this could trigger acceleration to the upside with N1.80 and N2.00 next target. 

All odds are in favor of the bulls and indicating a bullish signal. Presently, stock is trading between the crossed major and minor EMA lines and candles are totally generating bullish signal. Both investors and traders are displaying the 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?

A bullish engulfing followed by pair of piercing candlesticks are providing bullish signal. Both RSI and CCI indicators have been reached into positive territory and generating bullish signal.

A bullish crossover on the MACD indicator is also favoring the bulls. Intraday bias remains bullish on the stock as long as N1.10 level remains intact. The N1.60 level is key resistance level followed by N1.80 whereas N1.10 can be considered as key support level followed by N1.00 level.

Trade Idea:
Based on the charts and explanation above, traders and investors can buy at N1.40 level for the target price of N1.80 and N2.00 level with the stop loss of N1.10 level.  The tentative time frame would be 8-10 days.

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

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UBCAP Falling wedge pattern is in process of formation- Proshare

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

For further details, kindly contact analyst@proshareng.com 

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