Dear Readers,
A Leading Diagonal Pattern formation has been witnessed and looks to have completed in the stock of NTPC from its low price of 107.10 to its recent high price of 178.25. The same can be visible from the given chart as shown.
After the completion of this leading diagonal, the stock of NTPC seems to be in corrective zone and looks like forming a simple zigzag (5-3-5) corrective pattern, though it is too early to predict the possible corrective formation. However, at first look it looks to be forming the simple zigzag pattern.
The first leg, wave 'A', of this simple zigzag pattern, looks to have completed its first three waves, is about to complete or have completed it fourth wave and will complete its last wave five over next few days. A parrallel channel has been drawn to show the possible resistance and support point for making entry or exit.
Secondly, the stock is witnessing sideways movement as against the sharp fall in the third wave of wave 'A'. This indicates that the stock has little less interest of retracing this fall aggressively. The upper line of the parrallel channel may act as resistance line. A decisive breach of resistance line with sharp rise in price with volume, may negate the possibility of the zigzag formation.
The stock of NTPC can be sold/shorted at current price of 160 for the price targe of 154, 150 and 144 with stop loss of 167.
Disclamer:
All views, charts, comments, post or any materials of any kind discussed, published, posted and/or commented are for educational purpose only and not meant to be an advice to trade not does it or the publisher of it guarantee any sort of return or the correctness of the post or any materials.