Havells India Ltd, a prominent player in the consumer electronics industry, has captured investor attention with a remarkable 15% surge in its stock price over the past month. Adding to the excitement, the company has broken out from an Ascending Triangle pattern on its weekly charts, sparking optimism among short-term traders.
Experts suggest that this breakout could signal a buying opportunity, with a target price of Rs 1600 within the next 1-2 months.
The stock’s recent ascent is notable, rising from Rs 1275 on August 14, 2023, to Rs 1431 as of September 15, 2023. This impressive performance translates into a gain of over 15% in just one month, culminating in a fresh 52-week high of Rs 1466 on September 11, 2023.
The breakout from the Ascending Triangle pattern, as observed on the weekly charts, is particularly significant. This pattern connects the stock’s highs from October 2021, September 2022, and August 2023, with the pattern’s neckline situated above Rs 1300.
In terms of price action, Havells India’s stock is currently trading comfortably above key short- and long-term moving averages, including the 5, 10, 30, 50, 100, and 200-DMA on the daily charts, signaling a positive sentiment among investors.
Additional technical indicators also support the bullish sentiment. The daily Relative Strength Index (RSI) stands at 63, indicating a healthy position. Typically, an RSI below 30 is considered oversold, while above 70 is deemed overbought. Furthermore, the daily Moving Average Convergence Divergence (MACD) is positioned above its center and signal line, a bullish indicator.
Omkar Patil, Technical Research Associate at GEPL Capital, commented on Havells India’s strong performance, stating, “Havells India stock exhibits a strong upward trend. Since October 2021, it has managed an admirable correction, avoiding any patterns of lower highs and lower lows.”
He added, “Now it is trading close to its all-time high levels, the momentum for Havells appears confidently positive. Recently, a breakout from the Symmetrical Triangle pattern was spotted, reinforcing the stock’s consistent bullish inclination.”
Patil went on to emphasize, “Furthermore, the weekly chart’s RSI emphasizes a breakout, signifying an increase in price momentum. Going ahead we expect the prices to move higher till 1600 level where the stop loss must be 1350 strictly on the closing basis.”
In conclusion, Havells India’s recent rally and technical indicators are pointing towards a favorable outlook for the stock, with short-term traders eyeing a potential target of Rs 1600 in the near term. This breakout from the Ascending Triangle pattern underscores the company’s bullish momentum, making it a stock to watch closely in the coming months.
