MUMBAI: The stock of Container Corporation of India Ltd (CONCOR) has formed a piercing line candlestick pattern on the weekly scale. The piercing line candlestick pattern is considered to be a bullish reversal pattern and usually occurs at the bottom of a downtrend.
The piercing line pattern is a two candlestick pattern. The first candle is red, which supports the downtrend and the second candle is a long green candle, which opens below the close of the previous candle and then closes above the midpoint of the preceding red candle. This action triggers concerns for the bears and the stock reaches a potential bottom.
After a span of almost one and half months, CONCOR has managed to successfully close above its crucial short-term moving average i.e. 13-day EMA. Besides, the stock is trading above its weekly pivot since last four trading sessions. From the momentum indicators perspective, the 14-period daily Rs.I is currently quoting at 40.62 and it is trading above its 9-day average. The daily stochastic oscillator is also suggesting some bullish strength as %K is above the %D. Moreover, the momentum indicator MACD line has crossed above the signal line, which resulted in histogram turning positive.
Going ahead, the stock has immediate support in the zone of Rs. 478-475 level, while the major support is placed in the range of Rs. 465-460 as upward sloping trendline is placed in that zone. On the higher side, any sustainable move above the level of Rs. 510 is likely to open up gates for further rally in the stock price, towards the levels of Rs. 520, followed by Rs. 540.