JSW Energy shares rebounded nearly 19 percent after hitting an 8-month low of Rs 205 in the beginning session of last week. In fact, it has taken a support exactly at upward sloping support trendline adjoining lows of June 18, 2021 and June 20, 2022, but overall, it has been in consolidation since hitting a record high in October 2021. It was one of the multibaggers in 2021.
The stock has formed long bullish candle with upper shadow on the daily charts on March 3, indicating some profit booking at higher levels, following consolidation for a couple of days. Also, there was strong bullish candlestick formation on February 28.
The rally last week was driven by high volumes, which in fact, was higher since the week ended October 3 last year.
On the weekly charts, it has formed Bullish Engulfing kind of pattern, which is a positive sign.
Also, JSW Energy touched the high seen in February of around Rs 250 on March 3, but retraced a bit due to profit booking on same day. This is expected to be a crucial level for further upside towards 200 EMA (exponential moving average - Rs 275), with support at around Rs 205. If these things take place in coming sessions or weeks, then the stock may move towards previous swing highs, experts said.
The counter had become a multibagger in the year 2021, and after that, we have seen profit booking from the higher levels. Then, it took a crucial Fibonacci support zone of Rs 180–200, which is the 61.82 percent retracement level (from March 2020 low to October 2021 high).
"It has witnessed a breakout of an Inverse Head & Shoulder pattern formation on the hourly chart. The structure of the counter is not lucrative, but in the last few trading sessions, it has taken support from Rs 200 levels with massive volume," said Pravesh Gour, Senior Research Analyst at Swastika Investmart.
On the upside, he feels the levels of Rs 250 operate as susceptible levels; above these, one can anticipate a protracted move towards Rs 280+ in the shorter to longer term. On the downside, Rs 200 acts as a crucial support during any pullback, he said.
JSW Energy has clawed above the previous month's high on back of pretty big volumes. The fast approaching the 200-day EMA at Rs 275, which might be an immediate resistance, said Vidnyan Sawant, AVP - Technical Research at GEPL Capital.
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