VITAFOAM: Stock has bottomed out; a fantastic rally is awaited.


Monday, July 6 2015 09.20 AM / Harish Shahi, The Analyst 

A closer look on the daily chart of
VITAFOAM reveals that earlier bulls were making successively higher highs and higher lows and then we have seen some profit booking or some correction in the stock however that correction was exactly 50% Fibonacci retracement from N3.50 to N6.50 level.

After testing the 50% Fibonacci retracement, we have seen a strong reversal candlestick i.e. hammer and then bulls never looked back and headed towards north side. Well this is a time to buy the stock as stock has crossed all the three moving averages which were acid test for bulls.

An uptrend line is also lying on the daily chart which is encouraging the bulls and suggesting to us to buy on dips and dips has been completed, so a fantastic rally is likely to come.

Short term to intermediate trend is up and stock is trading above all major and minor EMA lines so we are keeping our view bullish on the stock. Investors and traders are displaying bullish tendency towards the stock for the time being. 

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What Next?

Two consecutive bullish marabuzo candlesticks with combination of golden crossover of 15 EMA and 50 EMA is insisting us that just grab the buying opportunity don’t miss this time.


Both RSI and CCI are providing bullish signal/trend reversal from negative territory.  Intraday bias remains bullish on the stock as long as N4.67 level remains intact. The N6.50 level is key resistance level followed by N6.80 whereas N2.40 can be considered as key support level followed by N2.20 level.


Trade Idea:

Based on the charts and explanation above, traders and investors can wait for the right time to buy the stock and initiate their buy position once it comes down to N2.40 level  for the target of N2.80 and N4.67 level with the stop loss of N4.00. The tentative time frame would be 14-18 days.

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

Related NEWS

VITAFOAM Golden retracement a steep bounce likely to occur  - 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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