MTAR Technologies Ltd., Inverted Head and Shoulder PatternKey Observations:
Pattern Structure:
Left Shoulder: Formed as the price dipped and rebounded.
Head: A deeper dip, followed by a recovery, forming the head of the pattern.
Right Shoulder: A final dip, higher than the head, completing the structure.
The neckline (resistance line) is slanted slightly upwards, showing gradual bullish sentiment.
Breakout:
Once the price breaks above the neckline with strong volume, the pattern is confirmed.
This breakout is expected to lead to the projected target.
Target Projection:
Height of the pattern (from the head to the neckline): Approx. 660 points.
Adding this to the breakout level (neckline at ~1,500), the target is estimated at 2,160 INR, indicating a 39.73% upside.
Current Price:
Trading around 1,637 INR, slightly above the breakout region.
It’s crucial to watch if the breakout sustains above the neckline.
Volume Analysis:
Volume during the breakout is critical for confirming strength.
Rising volume would indicate buyer conviction.
Technical Implications:
Bullish Sentiment: The Inverted Head and Shoulders is a strong bullish reversal pattern, often signaling the end of a downtrend.
Support Levels:
1,495 INR: Key support below the neckline.
1,565 INR: Intermediate support.
Resistance Levels: The immediate target is 2,160 INR, but resistance may appear near 1,900 INR on the way up.
Potential Trading Strategy:
Entry: On a confirmed breakout above the neckline, around 1,650 INR.
Stop Loss: Place below the neckline at 1,495 INR for risk management.
Target: Aim for 2,160 INR, aligning with the pattern's projected move.
Risk Factors:
If the price falls below the neckline (around 1,495 INR), the bullish setup may invalidate.
Macro factors or sector-specific news could impact momentum.
