Chart Busters: Top trading set-ups to watch out for on Thursday.

The benchmark index Nifty has marked a fresh all time high in Wednesday’s trading session. The Nifty Midcap 100 has outperformed the frontline indices as it has gained over 1.5%. The Nifty Smallcap 100 has marked the fresh all time high of 11626.60 and thereafter witnessed profit booking. The advance-decline ratio was in the favour of advancers.

Here are the top trading set-ups to watch out for Thursday.

Federal Bank: After registering the high of Rs 92.50, the stock has witnessed consolidation. During the consolidation, the stock has formed a symmetrical triangle pattern on the weekly chart. On Wednesday, the stock has given a symmetrical triangle pattern breakout on the weekly chart. Further, on breakout day the volume was expanded by nearly 4 times of 50-days average volume, which indicates important buying interest. The 50-days average volume was 1.42 crore while today the stock has registered a total volume of 5.41 crore. In addition, the stock has formed a sizeable bullish candle. Currently, the stock is trading above its short and long-term moving averages.

Daryl Guppy’s multiple moving averages is suggesting a bullish strength in the stock. On the daily chart, the 14-period RSI has surged above the 70 mark and it is in rising mode. The RSI has also surged above its prior swing high. The daily MACD stays bullish as it is trading above its MACD line and the signal line. The MACD histogram is suggesting a pickup in upside momentum. On the daily timeframe, ADX is below the 25 mark and suggests that the trend is yet to be developed. Directional indicators continue in the ‘buy’ mode as +DI continues above –DI. Going ahead, as per the measure rule of symmetrical triangle pattern, the first target is placed at Rs 105, followed by Rs 113 level. While on the downside, the 8-day EMA is likely to act as strong support for the stock.

Godfrey Phillips India: On September 29, 2021, the stock has given 79-weeks consolidation breakout along with strong volume. Thereafter the stock has gained over 23% in just four trading sessions. After this sharp upside, the stock has witnessed a minor throwback. During the same period, the volume activity was not significant. Hence, it should be viewed as a routine decline after a robust move. The throwback is halted near the 38.2% Fibonacci retracement level of its prior upward move and it coincides with the 8-day EMA level. The stock has formed a strong base near the support zone and today it has bounced sharply, which indicates that upmove has been resumed. On Wednesday, the stock has formed a sizeable bullish candle along with above 50-days average volume.

An interesting observation is witnessed on the daily RSI. In the recent throwback phase, the RSI never breached its 60 mark, which indicates that the stock is in a super bullish range as per RSI range shift rules. The daily stochastic has also taken support near the 20 mark and it has given positive crossover. The technical evidence indicates a strong upside in the next couple of trading sessions. The prior high of Rs 1368 will act as minor resistance for the stock. While on the downside, the zone of Rs 1270-1230 is likely to provide the cushion in case of any immediate decline.