Reversal play in Shyam Metalics (#SHYAMMETL)

With Nifty Metal Index breaking out today, lets see how Shyam Metalics SHYAMMETL can play out from here...


Stock was clearly in downtrend, making Lower Highs and Lower Lows (blue & red highlights on the chart).

But it can reverse from here now. How? Here are some observations:

- It recently took support at IPO Price
- Made first Higher High (green highlight)
- Currently facing resistance from 14th Sep AVWAP (Rs. 354).
- Can take support at 20th Dec AVWAP (Rs. 338)
- Crossing above Rs. 354 will most probably break the support-turned resistance zone of Rs.360 too with force.
- Later, it can face resistance from 22nd July AVWAP (Rs. 383) and come to retest the Rs. 360 area.
- There should be no looking back once it crosses the 22nd July AVWAP
- Company has high ROE (above 20%) and currently trades at lower valuation multiples than its peers.

Disclaimer: Do not consider this as a trade recommendation.