Breakout stocks of the day: Cholamandalam Financial Holdings and JK Lakshmi Cement

Cholamandalam Financial Holdings and JK Lakshmi Cement are showing promising signs of a strong bullish breakout based on price and volume support. Currently, their stock prices are at Rs 1,101 and Rs 935, respectively. The charts reveal a symmetrical triangle pattern and a period of consolidation, indicating potential for an upward price movement.

Cholamandalam Financial Holdings

Daily chart of Cholamandalam Financial Holdings 

Cholamandalam Financial Holdings is currently showing a strong and showed an attempt to trend upward on the daily chart. This is marked by a clear breakout from a symmetric triangle pattern, indicating a potential start of the short-term trend. The breakout is supported by significant trading volume, indicating active buyer involvement.

In Thursday’s trading session, the stock started at Rs 1,099 and reached a peak of Rs 1,110. After about 30 days of forming a symmetric triangle, the stock successfully broke the upper trendline of the pattern, suggesting a positive shift in the long-term trend. The stock’s current price prior highs, accompanied by increased volume before the breakout.

The breakout suggests that Cholamandalam Financial Holdings is poised for further growth soon. The stock is trading above its 50-day Exponential Moving Average (EMA), which acts as a support and indicates the stock’s effort to establish new highs.

Looking at the daily Relative Strength Index (RSI) chart, the RSI is in the 65-80 range, indicating strength in the current trend. Additionally, the Average Directional Index (ADX) is rising at 15, suggesting the emergence of directional strength and the potential start of a new trend.

In case of a retracement, it’s important to keep an eye on key support levels, particularly at Rs 962. The stock might face minor resistance at its 52-week high. Overall, the favourable structure is maintained as the stock consistently trades above important moving averages, confirming a sustained long-term upward trend.

Cholamandalam Financial Holdings Ltd. engages in the provision of investment services.

JK Lakshmi Cement Ltd 

Daily chart of JK Lakshmi Cement 

JK Lakshmi Cement’s stock is currently displaying positive signs in its performance. The stock chart shows a green candle facing some selling pressure, but it has successfully broken out of a consolidation range. This breakout was accompanied by a notable increase in trading volume, indicating strong market interest. The stock price is currently trading above the breakout level, starting at Rs 887 and reaching an intraday high of Rs 970 on Thursday.

This breakout is significant because it follows a period of consolidation, suggesting a potential continuation of the bullish trend if the stock consistently closes above its all-time high. Additionally, the stock price is showing a pattern of rising with intermittent bounces from the 50-day Exponential Moving Average (EMA), which is acting as dynamic support for the stock over a longer timeframe.

The market action is supported by a surge in price volume, surpassing the typical trading day volume. The Relative Strength Index (RSI) has recently entered the 65-80 range, indicating the possibility of a substantial upward movement in the stock price, especially as it continues to trade at higher levels. The Average Directional Index (ADX) is currently at 24, suggesting promising directional strength with minimal sideways movements.

The upper resistance of the consolidation serves as crucial support during larger abrupt downward movements, and the overall market structure is favourable for traders, as the stock consistently trades above major moving averages.

JK Lakshmi Cement Ltd. engages in the manufacture and market of cement.

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.