Breakout stocks of the day: Visaka Industries and Chalet Hotels

With price volume support, Visaka Industries and Chalet Hotels are strong bullish breakout potential stocks. The stock prices have displayed range breakout and pullback, and both presently trading at Rs 115 and Rs 758. The breakout and pullback align with positive signals from technical indicators such as RSI, ADX, and other key metrics, reinforcing the likelihood of continued upward momentum.

Visaka Industries

Daily chart of Visaka Industries 

Visaka Industries is currently displaying a sustained bullish momentum on the daily chart, characterised by a notable breakout from a compelling consolidation range. This breakout is supported by the strong volume observed in today’s trade highlighting active buyer participation with substantial daily volume.

Tuesday’s trading session initiated at Rs 111 and reached a peak of Rs 119. After seven months of consolidation, the stock has successfully breached the upper resistance of the pattern, indicating a potential long-term trend continuation.

The current stock price exceeded its 52-week high, driven by increased volume during the pre-breakout rally. This breakout sets Visaka Industries up for a positive trend shift, and the accumulated volume suggests further growth in the near future. The bounce from the near-upper resistance acted as support emphasising the stock’s effort to establish new highs.

On the daily RSI chart, the relative strength index is entering the 65-80 range with similar pattern formation, and a robust ADX at 39 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 104. The minor upper resistance is at Rs 133 for the stock, and the overall favourable structure is maintained as the stock consistently trades above crucial moving averages, affirming a sustained long-term upward trend.

Visaka Industries Ltd. engages in the manufacture and sales of cement asbestos products, textile, and fibre cement flat board products.

Chalet Hotels Ltd 

Daily chart of Chalet Hotels 

Chalet Hotels’ current stock performance is characterised by a green candle facing slight selling pressure. It has given a breakout from a symmetric triangle long before, accompanied by a significant increase in trading volume. Currently, the stock price is bouncing back from the 20-day EMA and resistance acting as support. Starting at Rs 734 on Tuesday, the stock reached an intraday high of Rs 775. This pullback is notable as it follows a few months of an uptrend, suggesting a likely continuation of the bullish trend if the price manages to close above an all-time high.

Confirmation of the breakout will occur with a closing of the day candle, indicating a bullish momentum. After reaching its ATH, the stock may witness a rapid ascent in the next trading sessions 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 42, indicates very strong directional strength with sideways movement. The 20-day Exponential Moving Average (EMA) serves as a crucial support level during larger corrective movements, and the overall market structure favours traders, with the stock consistently trading above major moving averages.

Chalet Hotels Ltd. is a holding company, which is an owner, developer, and asset manager of hotels in various metro cities in India.

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.