Today's big Black candle which engulfed the last 2 candles and closed at lowest level is showing the forthcoming weakness. It is also showing bearish divergence in the overbought Zone. One can short the stock at the level where Stop Loss of 1102 on closing basis is affordable to them.
The stock has formed a nicely Wolfe wave at the Junction which seems to work as resistance. My experience with this patter is that it works better if it breaks the boundaries come back but we can still take the chance here by providing small stop loss of high of recent swing. Mostly it offers good risk to reward trade. Good Luck!
With reference to my previous post on learning how to use RSI Divergence for trading. I've observed a beautiful trade is developing. The trade is almost ready so one can put it into their watch list, observe the price movement and take timely action.
Channel and RSI Divergence are suggesting a short at current level for a target of 28.30 by providing a suitable Stop loss. However one can notice that Primary trend started on Aug 2015 is still intact and driving the prices higher so it is not for trend follower but small contra trend to add fast profit to your capital and exit.
Divergence are lucrative and effective method to trade, however many people find it difficult to use so I am giving important points one should keep in mind:
1. RSI divergence should be used when formed in overbought or oversold Zone. Others may be used in combination with other studies but NO trade solely based on it.
2. Since we are handling here the situation...
ABIRLANUVO perfect balance sheet company. The company will be in the correction mode now. One can buy it at the level of 1331 with the target of 1450 in coming days.
Even RSI is showing overbought as of now.
Oh my god! TCS has given major bullish signals in MACD and RSI. Please see the Arrows you will get what I am Talking about and TCS is in value Zone. One can buy Nov Futures and stay long for a target of 2450-2500-2520 with a stoploss of 2354 on closing basis. One can accumulate 2450 Nov calls all trading @ cheap rate.. Best of luck