BHEL Chart Analysis
1. BHEL took support at the levels of 42.0 to 42.30 in October 2019. These were pre - Covid times.
2. BHEL took support at the same levels of 42.0 to 42.30 in the 1st week of Jan 2020. Again, the market has not yet started responding to the Covid pandemic.
The support was finally broken in February and BHEL reached the levels of 19.20. From there it made a reversal and entered into an UPTREND.
3. The previous support at 42.0 became a Resistance. The breakout failed. Notice the volume. It was above average but BHEL has shown higher volumes when it was recovering from the Covid Lows.
4. Again the stock failed to cross the level of 42.0 forming a DOUBLE TOP.
5.The stock then fell down to the Double Top Confirmation Line. The price behavior (wick rejections and selling pressure) here suggested that the fall was to continue.
The price fell down to form a DOUBLE BOTTOM. The Double Bottom Confirmation Line was breached and the stock entered into an UPTREND on the daily chart.
6. The price has now started forming an upward Trend Line.
7. Again a breakout (with above-average volume) from the level of 42.0 failed on 8th February 2021.
Now, the range for price movement is tightening due to the resistance at 42.0 and the trendline support. I have observed that the breakout (either way) occurs at the levels where the resistance and the trendline coincides. Let us see how it unfolds. The levels which would act as Resistance or Support when the breakout is successful is marked on the chart with Red and Green lines respectively. These levels can also be used as intermittent targets to trade.
Since I am a new trader, kindly mention anything that I have misinterpreted or have missed.
2. BHEL took support at the same levels of 42.0 to 42.30 in the 1st week of Jan 2020. Again, the market has not yet started responding to the Covid pandemic.
The support was finally broken in February and BHEL reached the levels of 19.20. From there it made a reversal and entered into an UPTREND.
3. The previous support at 42.0 became a Resistance. The breakout failed. Notice the volume. It was above average but BHEL has shown higher volumes when it was recovering from the Covid Lows.
4. Again the stock failed to cross the level of 42.0 forming a DOUBLE TOP.
5.The stock then fell down to the Double Top Confirmation Line. The price behavior (wick rejections and selling pressure) here suggested that the fall was to continue.
The price fell down to form a DOUBLE BOTTOM. The Double Bottom Confirmation Line was breached and the stock entered into an UPTREND on the daily chart.
6. The price has now started forming an upward Trend Line.
7. Again a breakout (with above-average volume) from the level of 42.0 failed on 8th February 2021.
Now, the range for price movement is tightening due to the resistance at 42.0 and the trendline support. I have observed that the breakout (either way) occurs at the levels where the resistance and the trendline coincides. Let us see how it unfolds. The levels which would act as Resistance or Support when the breakout is successful is marked on the chart with Red and Green lines respectively. These levels can also be used as intermittent targets to trade.
Since I am a new trader, kindly mention anything that I have misinterpreted or have missed.
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