The stock market has been observing a steep upward trajectory in recent times, leading to an oversold condition of oscillators. Despite this rapid rise, the market seems to be settling into a consolidation phase. This two-day period of little to no change in stock prices is indicative of a continuation pattern, suggesting the market’s ongoing uptrend could be sustainable.
Cup and Handle Pattern Indicates Sustained Uptrend
Interestingly, the market shows signs of a “cup and handle” pattern, a bullish technical indicator that often precedes an upward price breakout. This particular pattern is encouraging for investors, with initial targets being eyed at Rs 18-20.
Key Support Level at Rs 12
However, the market isn’t without its risks. The key support level is identified near Rs 12, serving as a downside marker. If prices fall to this level, it could trigger a broader sell-off. Therefore, it is critical for investors to keep a close eye on this level.
- The steep market rise prompts near-term profit booking.
- The formation of a continuation pattern during the two-day consolidation suggests a sustained uptrend.
- A cup and handle pattern indicates an initial target of Rs 18-20.
- The key support level, acting as a downside marker, is near Rs 12.
Investors should be aware of the volatile nature of the market. Although the current analysis shows a potential sustained uptrend, they should be ready to adjust their strategies according to changing market conditions.