skf india share price: Chart Check: Breakout from a bullish flag pattern could take SKF India to Rs 6,000; time to buy this multibagger?
The stock with a market capitalisation of more than Rs 24,000 cr hit a record high of Rs 5,074 on September 12, 2022, but failed to hold on to the momentum.
The recent price action helped the stock to break out from a bullish flag pattern on the weekly charts which is a positive sign for the bulls. A bullish flag is usually formed in stocks with strong uptrends and is considered a continuation pattern.
The stock rose more than 9% in a week, and more than 10% in a month. On a 3-year basis, the stock has rallied more than 100%.
The stock is trading close to overbought levels which could result in some profit taking but traders can look to buy the dip. The Supertrend indicator also triggered a buy on daily charts in November.
The Relative Strength Index (RSI) is at 69.3. RSI below 30 is considered oversold and above 70 is considered overbought, Trendlyne data showed. MACD is above its center and signal line, this is a bullish indicator.
In terms of price action, the stock price is trading above most of the crucial short- and long-term moving averages of 5,10,30,50,100, and 200-DMA which is a positive sign for the bulls.
“While looking at the border picture of SKF India, we can spot that the stock has maintained its structure by not getting into lower high, lower low formation in the correction post December 2021. This shows that the stock is relatively stronger,”
Patil, Technical Research Associate at GEPL Capital, said.
“The stock in the latest week has given a breakout from bullish flag pattern, indicating continuation of the prior uptrend,” he said.
Prices have shown a bounce to the upside while taking support from 15-weeks EMA. This has acted as a strong variable support for the prices.
“RSI on the weekly timeframe has shown a range shift, indicating the rising momentum of the underlying. Going ahead we expect the prices to go higher till the level of Rs 6,000 where the stop loss must be Rs 4,300, strictly on the closing basis,” recommends Patil.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times.)
