Varroc Engineering shares surged eight percent at 3 pm on April 2, after the counter demonstrated an Inverted Head and Shoulders breakout. According to Axis Securities, heightened volume activity in the scrip was observed at the breakout, further amplifying market participation and reinforcing the significance of the breakout.
Technical chart of Varroc Engineering displaying the Inverted Head and Shoulders breakout.
"Varroc has demonstrated a significant breakout above the neckline of the 'Inverted Head & Shoulders' pattern at 520 with a robust bullish candle, signaling a potential shift from a downtrend to a positive trajectory," said Axis Securities. The heightened volume activity witnessed at the breakout further amplifies market participation, reinforcing the significance of the breakout.
Also read: F&O Manual | Indices consolidate at higher levels, Nifty sees support at 22,425
The brokerage firm highlights the stock's ability to maintain levels above key short- and medium-term moving averages (20, 50, 100, and 200 days), signaling a positive bias in its trajectory.
"The daily Relative Strength Index (RSI) remains in bullish territory, holding above both its reference line and the 50 mark, reinforcing a positive bias in the stock," added Axis Securities.
The brokerage house believes that with the breakout from the Inverted Head and Shoulders pattern, the stock is anticipated to rally towards previous swing highs, setting targets at Rs 595 and Rs 613.
It recommends accumulating the stock in the Rs 540-530 range, with a target price of Rs 595, offering an upside potential of 11-15 percent.
Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
