Technical Analysis of Datamatics Global Services Ltd.
Trade Setup: BUY DATAMATICS @ 117-118 | Target: 134.00-150.00 | Stop Loss: 111.80
On a monthly chart, in April, there was the formation of “Bullish Engulfing” as indicated on the charts by green arrow and rectangle box.
High: 139.50 | Low: 102.50 | Open: 104.45 | Close: 128.80
As there was a formation of “Bullish engulfing“, so for the month of “May”, an upside is expected after retracement. Retracement can be either 13points-17 points. That means, we can expect a retracement to the levels of 111.80 (128.80-17.00).
On the weekly chart, as indicated by rectangle box and arrow “A” as indicated by red colour formation of Bearish Engulfing took place in the previous week (14 May-18 May); this was expected as we have already calculated on the monthly charts for retracement till the levels of 111.80.
So on the weekly chart,
Open: 124 | High: 125.95 | Low: 118 | Close:119.15
Since it was bearish engulfing, so we expected a few more dips of 4-7 points from close. That means 119.15-4 = 115.15.
This indicates from the monthly and weekly charts that a retracement can be till the levels of 115.15-111.18.