Chart Busters:Top trading set-ups towatch for Friday

With improved sentiment across the global market, the domestic market rallied and closed above the key moving averages. The index closed above the 50DMA but failed to close above the 200DMA, despite the sharp run-up. The index is still below its gap area resistance. It may attempt once again to fill the gap in the next one-two days. Earlier, it tried to fill the gap on April 21 but was unsuccessful.

Since April 5, the index experienced gaps on both sides almost every day, with a majority on the downside. It tested the 50% retracement level twice and made four higher low candles. But, it failed to form a higher high. Over the last seven days, the benchmark index formed a counter-trend consolidation pattern, the Pennant. The Bollinger bands are moving parallel in a wide range. The consolidation is likely to continue unless the Nifty fills the gap and closes above 17610. On the downside, a prior bar close or a close below 17103 (50DMA) will be negative.

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

ASIANPAINT: The stock closed above the prior swing high, and it has broken out of an ascending triangle with higher volume. The stock also closed above the 100DMA, which acted as resistance. The Bollinger bands suggest an explosive move on the cards. The MACD histogram suggests an increase in bullish momentum. The Elder impulse system has formed two strong bullish bars consecutively. RSI is above the 62 zone and entered the strong bullish zone. The KST and TSI indicators gave the bullish signals. The stock is above the Anchored VWAP. In short, the stock registered a bullish breakout. A move above Rs 3250 is positive, and it can test Rs 3378. Maintain a stop loss at Rs 3220.

MFSL: The stock has formed a double bottom pattern. It closed at 20DMA and at a seven days high. The MACD has given a fresh buy signal. RSI is also formed higher lows after a series of parallel lows. The directional movement indicators are at an influx point and indicate a sharp upside move, while the Elder Impulse System has formed a bullish bar. The TSI also has given a bullish signal. It closed above the Anchored VWAP support. It is also above the TEMA. In short, it shows a positive strength. A move above Rs 767 is positive, and it can test Rs 807. Maintain a stop loss at Rs 750.

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