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

In the last five trading sessions, the Nifty index has gained 458.65 points or 2.64%. On the weekly chart, the price action has formed a bullish candle carrying higher high and higher low, which indicates the continuation of an uptrend. Interestingly, the 14-period weekly RSI has given a positive crossover, which is a bullish sign. The banking benchmark index, Bank Nifty has become the top performer of the week as it has supported Nifty to soar higher during the week. The Bank Nifty has gained 2258 points or 6.36% in the last five trading sessions.

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

Devyani International: Since the last 56 trading sessions, the stock is trading in a rising channel on the daily chart (logarithmic scale). After registering the high of Rs 198.90, the stock has witnessed correction along with low volume. The correction is halted near the demand line of rising channel.

Since the last couple of trading sessions, it has formed a strong base near the demand line of the rising channel and started rising higher. The reversal from the support zone is further justified by robust volume. The stock is trading above its short-term moving averages, i.e. 20-day EMA and 50-day EMA. These moving averages are in rising mode. 

The momentum indicators and oscillators also support the overall price action. The leading indicator, 14-period daily RSI has surged above the 60 mark and it is in rising mode. Pring's KST has given a fresh buy signal on the daily chart. On the daily timeframe, ADX is 16.79 which suggests that the trend is yet to be developed. Directional indicators continue in the ‘buy’ mode as +DI continues above –DI. 

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. 

Asahi India Glass: On Friday, the stock has given downward sloping trendline breakout on the daily chart. This breakout was confirmed by above 50-days average volume. Additionally, the stock has formed a sizeable bullish candle on breakout day, which adds strength to the breakout.

As the stock is trading at its 52-week high, all the moving averages based on trade set-ups are showing a bullish strength in the stock. Daryl Guppy’s multiple moving averages is suggesting a bullish strength in the stock. Further, it is also meeting Mark Minervini’s trend template rules. These two set-ups are giving a clear uptrend picture in the stock.

The Relative Strength Index (RSI) has reached its highest value in the last 14-days, which is bullish. Also, it has managed to close above its prior swing high. The daily MACD stays bullish as it is trading above its zero line and signal line. The ADX and +DI is above the -DI, which indicates positive strength in the stock.

Based on the above observations, we expect the stock to continue its upward movement and test levels of Rs 560, followed by Rs 585 level. On the downside, the level of Rs 484 will act as minor support.