Breakout stock of the day: Jammu & Kashmir Bank forms an ascending triangle

Jammu & Kashmir Bank is a strong positive breakout candidate with price volume support. The stock price is currently trading at Rs 121 and has witnessed the formation of an ascending triangle chart pattern. The RSI, ADX, and other parameters of technical analysis are in sync with the breakout.

Ascending Triangle Chart Pattern

An ascending triangle is a chart pattern in technical analysis that indicates a potential breakout to the upside. It is formed when the price of an asset fluctuates between a horizontal upper trendline and an upward-sloping lower trendline, creating a triangle shape that points upwards.

This line connects the highest price peaks of the triangle. It acts as a resistance level that the price struggles to break above. This line connects the lowest price troughs of the triangle. It indicates a gradual increase in buying pressure as the price makes higher lows. As the triangle progresses, the upper and lower trendlines converge towards each other, narrowing the price range and creating a sense of compression.

The ascending triangle is generally considered a bullish continuation pattern. This means that it occurs during an ongoing upward trend and suggests that the price is likely to continue rising once it breaks out of the triangle. The breakout typically occurs when the price closes above the upper trendline with increasing volume. This confirms that buyers are gaining control and pushing the price higher.

Jammu & Kashmir Bank Ltd

1-day chart of Jammu & Kashmir Bank 

Jammu & Kashmir Bank’s stock trading with a strong green candle day progresses to complete a chart pattern called an ascending triangle chart pattern its breakout.

The stock witnessed a gap-up opening at Rs 114, jumped to its day high of Rs 127, and remained the same. The stock has been in an uptrend for the last 5 weeks.

Jammu & Kashmir Bank has formed an ascending triangle chart pattern with its breakout to continue the bullish trend. The stock price is trading at its 8-year high and may consolidate for a while to cool down this breakout. The stock continues to trade at its 52-week high with high momentum, as the banking stocks doing well. The stock price also witnessed a price volume breakout on Monday making this breakout strong with a spurt in volume more than 6 times.

The relative strength index also entered the 65–80 range with the same pattern formation, suggesting the stock price may grab the volatility in the coming time. The ADX indicator line is also turned upside to cross the 25 level, showing the good strength emergence of the price. The stock price also respects the moving average levels as it bounced from the same 5 weeks ago.

During any corrective moves, the major support level to watch for is Rs 116. The overall structure remains favourable for traders, as the stock continues to trade above all its important moving averages, indicating a sustained upward trend.

The stock has given multi-bagger returns of 6,125% over a decade.

Jammu & Kashmir Bank Ltd. engages in the provision of banking and financial services.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. The information is based on various secondary sources on the internet and is subject to change. Please consult with a financial expert before making investment decisions.