HDFC Life Insurance - An interesting Case

Here I am presenting an intriguing case involving HDFC Life Insurance stock⚡

On the left-hand side 👈 we have the weekly chart where two distinct zones emerged: a support zone and a resistance zone. An attempt to breach the support zone, occurring around 500, was made; however, this endeavor ultimately lacked follow through 😐 This resulted in a sudden and pronounced upward surge that propelled the stock past the resistance zone, situated around 617 🦾

On the right-hand side 👉 we have the daily chart. You can observe that the breakout of the resistance was not only successful but also promptly retested within a few trading sessions, leading to a resumption of the upward movement 🥂 Nonetheless, the stock encountered difficulties while approaching the 700 zone, culminating in the formation of a rising wedge pattern. It's worth noting that such a pattern is deemed bearish within the context of technical analysis ⚔

Subsequently, the stock experienced a retracement and has since retraced back to approximately the breakout level of 617. This specific level has previously acted as a point of resistance, thereby suggesting a likelihood of role reversal (may act as a support this time). Moreover, a closer examination of the candlestick patterns reveals that they have become narrower in proximity to the support area, indicating a potential waning of selling pressure👍

Furthermore, a falling wedge pattern, characterized as bullish, has also manifested. Should the stock's price successfully breach this wedge pattern to the upside, it may pave the way for an upward movement towards levels around 660, 700, or even 750 🚩

It's important to consider that this perspective would lose its validity should the price fails to escape the confines of the falling wedge pattern or commence trading below 600.

Thank you 🙏 for taking the time to read this analysis. If you find it insightful, please express your support 🚀 and anticipate more such ideas in the future 💰

Disclaimer: This is not an investment or trading advice. Please apply your own due diligence before investing your hard-earned money.

Comment:

The stock had a spiky break of the wedge yesterday which took it to resistance 655. Since then, it has been pulling back. As it is pulling back there is a wedge trendline support and a horizontal support near 630. Any bullish (buying) sign here may once again take the higher.