HBL Power today broke out of a small flag pattern. The flagpole extends from 76 to 99, and is marked in dotted lines. Breakout point is 97. Today breakout was accompanied with huge volumes which is a pre requisite for a flag breakout… (A flag is usually a cooling off period wherein after a sharp rise, stock price takes a pause to gather steam for further upmoves. Volumes shrink considerably during flag formation and need to increase comparatively on day of breakout. ) In case of HBL, stock price was suffering a lot of selling pressure after having declined from its swing high (which was a fresh all time high of 105) It took support at its 200 dema (marked in green line) and moved up to face further selling pressure close to 80. But with the news of fresh order wins followed by an annual report where there were bullish tones along with all the details of the business, stock price gapped up on 5 th September with a gap up area between 89.50 and 91.55.
The above mentioned gap also was above breakout from a triangular consolidation, taking the form of a Wolfe Wave.
Taking into consideration the pattern targets of both the Wolfe Wave and the flag breakout, if pattern plays out, targets can be in the range of 120-130. cmp 98-99.
disc: invested as disclosed before on my portfolio thread.
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