Chart Busters: Top trading set-ups to watch out for Friday

The benchmark index Nifty has ended marginally higher on the weekly expiry day. The index gained 0.25% or 45.45 points. The price action has formed a Dragonfly Doji candlestick pattern on the daily chart. The long lower shadow of the candle is indicating buying interest at days low. The Bank Nifty has underperformed frontline indices of Thursday as it has lost 0.67%. The overall Advance/Decline ratio is tilted in favour of bulls.

Here are the top trading set-ups to watch out for Friday.

The Anup Engineering: On Thursday, the stock has given a breakout of a Symmetrical Triangle pattern on the daily chart. This breakout was confirmed by a robust volume of nearly 11 times of 50-days average volume, indicating strong buying interest by market participants. The 50-days average volume was 27036 while on Thursday the stock has registered a total volume of 2.96 lakh. Further, this triangle breakout came with a rise in daily range. The last 10-days average daily range average is 32.65 points while on Thursday, the stock has witnessed a 182.15 points range. Further, it has formed a sizeable bullish candle, which adds more bullish sentiments.

As the stock has registered a fresh all-time high on Thursday, it is trading above its short and long-term moving averages. These averages are in the desired sequence, which suggests the trend is strong. Interestingly, the daily RSI has given a downward sloping trendline resistance breakout, which is formed by connecting swing highs since July 2021. This indicates bullish momentum. The MACD line just crossed the signal line, and the histogram became green. 

Considering the robust technical structure of the stock we believe it is likely to touch new highs. On the downside, the 20-day EMA will act as strong support for the stock, which is currently placed at Rs 1042.60 level.

Fiem Industries: The stock has formed a Dark Cloud Cover candlestick pattern as of November 11, 2021, and thereafter witnessed correction. The correction is halted near the 100-day EMA level. During the corrective phase, the stock has formed a Symmetrical Triangle pattern on the daily chart.

On Thursday, it has given a breakout of a Symmetrical Triangle pattern on the daily chart along with robust volume. With this breakout, the leading indicator, 14-period daily RSI surged above the 60 mark for the first time after November 11, 2021. The RSI is in rising mode and it is trading above its 9-day average, which is a bullish sign. Interestingly, the short term moving averages, i.e. 20-day EMA and 50-day EMA has turned upward significantly. On the daily timeframe, ADX is 10.96 which suggests that the trend is yet to be developed. Directional indicators continue in the ‘buy’ mode as +DI continues above –DI.

Technically, all the factors are currently aligned in support of the bulls. Hence, we would advise the traders to be with a bullish bias. As per the measure rule of the Symmetrical Triangle pattern, the upside target is placed at Rs 1380, followed by Rs 1540 in the near term.