Breakout stocks of the day: Bayer CropScience and Welspun Corp

With price volume support, Bayer CropScience and Welspun Corp have strong bullish breakout potential. The stock prices have displayed a rounding bottom and a consolidation breakout and is presently trading at Rs 5,902 and Rs 572. The breakout aligns with positive signals from technical indicators such as RSI, ADX, and other key metrics, reinforcing the likelihood of continued upward momentum.

Bayer CropScience Ltd

Weekly chart of Bayer CropScience Ltd 

Bayer CropScience is currently displaying a sustained bullish momentum on the weekly chart, characterised by a notable breakout from a compelling rounding bottom pattern. This breakout is supported by the strong bullish candle observed in the previous week’s close, highlighting active buyer participation with substantial weekly volume.

The Wednesday trading session initiated at Rs 5,990 and reached a peak of Rs 6,011. After six years of pattern formation, the stock has successfully breached the neckline of the pattern, indicating a potential long-term trend reversal and short-term continuation.

The current stock price has exceeded its 52-week high, driven by increased volume during the pre-breakout rally. This breakout sets Bayer CropScience up for a positive trend shift, and the accumulated volume suggests further growth soon. The bounce from the 20-day EMA emphasizes the stock’s effort to establish new highs.

On the daily chart, the relative strength index is entering the 65-80 range, and a robust ADX at 33 indicates strong directional strength, favouring a continued uptrend. In the event of a retracement, it is essential to monitor key support levels, particularly at Rs 5,665. The minor upper resistance is observed at Rs 6,140, and the overall favourable structure is maintained as the stock consistently trades above crucial moving averages, affirming a sustained long-term upward trend.

Bayer CropScience Ltd is engaged in the manufacture, sale, and distribution of crop protection products.

Welspun Corp.

Daily chart of Welspun Corp. 

Welspun Corp’s current stock performance is characterised by a robust green daily candle, poised for a potential breakout from a consolidation phase, accompanied by a significant increase in trading volume. Starting at Rs 539 on Wednesday, the stock reached an intraday high of Rs 575. This breakout is notable as it follows a few months of consolidation, suggesting a likely continuation of the bullish trend.

Confirmation of the breakout is expected with a strong upthrust in the daily candle, indicating a sustained bullish momentum. After reaching its 52-week high, the stock may witness a rapid ascent following today’s sustained levels. The current market action is supported by a surge in price volume, surpassing the typical trading day volume.

The relative strength index (RSI) recently entered the 65-80 range, suggesting the potential for a significant upward movement in the stock price, particularly as it continues to trade within this range. The ADX, currently at a low of 18, indicates very low directional strength. The 20-day Exponential Moving Average (EMA) serves as a crucial support level during corrective movements, and the overall market structure favours traders, with the stock consistently trading above major moving averages.

Welspun Corp is engaged in the manufacture of welded line pipes.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. The information is based on various secondary sources on the internet and is subject to change. Please consult with a financial expert before making investment decisions.