Hindustan Copper Breaks Consolidation Pattern, Surges 21% with Record Volumes

Despite mixed trends in the metal sector, one standout stock from the same industry rallied more than 21% in the current week, backed by unprecedented trading volumes of nearly 150 million shares, following the breakout of a consolidation pattern on weekly charts. 

Hindustan Copper Ltd. is involved in the exploration, exploitation, and mining of copper and copper ore. Formed in 1967 to take over from the National Mineral Development Corporation Ltd., HCL stands as the first Indian PSU and the only vertically integrated copper-producing company. Engaging in various processes, from copper mining to the final stage of converting copper into saleable products, HCL offers a range of products such as cast copper rod, copper cathode, copper concentrate, copper sulphate, sulphuric acid, reverts, anode slime, and nickel hydroxide. The company’s headquarters are in Kolkata, India.

Technically, a detailed analysis of the weekly chart reveals a 111-week consolidation phase. The stock has been trading within a wide range, with the upper boundary near Rs 196.75 and the lower boundary at Rs 81.20. Notably, the lower boundary aligns perfectly with the 61.8% retracement support level of the previous significant rally, as depicted on the weekly chart from March 2020. A trendline drawn from the high of the last week of July 2021 (Rs 158.70) to the mid-week of January 2023 (Rs 132.35) identifies the breakout trendline level (Rs 124) of the continuation price pattern.

Last week, Hindustan Copper Ltd. closed above the mentioned trendline level at Rs 127.85, confirming the breakout of the mentioned pattern. In the current week, it witnessed robust follow-up buying with unprecedented volumes in the stock’s history, resulting in a substantial surge of nearly 21%. This rally was accompanied by all-time high trading volumes of nearly 150 million shares. The stock’s minimum target is estimated to be around Rs 180, indicating a potential increase of over 40% from the breakout level.

Given these factors, the stock presents an attractive buying opportunity that merits careful attention in the upcoming sessions.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet, and is subject to changes. Please consult an expert before making related decisions.