The attached chart of this Personal Care Sector participant (Godrej Consumer Products) is indicating a beginning of a sharp weakness in the stock price, which is trading within 6.0% of Two Year High of 994.90 touched on 05th July-2017..
The gradual upmove of the last six-seven months seems to have completed, as the stock price has started to show weakness from the highs during this week.
Initial evidence of a beginning of declines is visible, on the basis of following parameters :
The stock price has lost momentum near upper band of placed at or near 980-1000 levels.
The 161.80% retracement of the previous major down move from 857.50 (September 2016) till 636.10 (November 2016) also placed at 1005 levels.
It has been observed till previous session close, stock is on the verge of forming a reversal pattern of high reliability, known to be an “Evening Star” pattern (shown in blue circular object), although the above said pattern will be validated only below 960 on weekly basis.
In the whole process we also observed prices making higher highs while indicator ( ) making lower lows resulting into “Regular Divergence” trading below 70 levels which is signaling a pause for further upside of the stock,
We believe the stock has the potential to move lower in the coming weeks and therefore recommend a Sell at CMP and selling more on any rises. Our entry levels, along with stop loss and targets have been mentioned above.