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Texmaco Rail & Engineering stocks recorded a breakout; rallied 10%!

11 September 20232 mins read by Angel One
From the last few trading sessions capital goods sectoral stock showed decent moves. One stock from the same sector based in industrial manufacturing, registered a breakout of the Cup and Handle patte
Texmaco Rail & Engineering stocks recorded a breakout; rallied 10%!
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In the mid-week session, Nifty opened gap-up and breached the consolidation zone of the last 6 trading sessions. It almost filled this gap in the first 2 hours of the trading session but later it recovered this fall and rallied towards days high level. From the last few trading sessions, one company from the capital goods sector showed decent moves and registered a breakout of Cup and Handle pattern by rallying more than 8% in today’s session.

Texmaco Rail & Engineering Ltd manufactures railways equipment and related products. It operates through the following segments: Heavy Engineering, Steel Foundry and Rail EPC. Its products include rolling stock, steel foundry, hydro-mechanical equipment and steel structures, process equipment, traction and coaching, bridges and structural, and rail EPC. The company was founded on June 25, 1998, and is headquartered in Kolkata, India.

The company has been maintaining a healthy dividend payout of 17.3% and is also well-placed on technical charts. If we draw the trendline from the highs of January 23, 2023 (Rs 61.65) and May 02, 2023 (Rs 61.10) we’ll get the trendline of Cup and Handle Pattern and Move from May 2, 2023, till today will act as a handle of this pattern.

Interestingly stock registered a breakout of this pattern and now trading above this trendline level as it surged more than 10% with strong volumes of more than 18 million. The minimum possible targets of this pattern will be around Rs 85, which is 40% from the trendline level (Rs 60.60).

Recently, the stock has registered a bullish crossover of 5-13-26 DMA and the 14 days RSI is also placed in the super bullish zone (78 RSI level) which indicates strong momentum. Thus, momentum traders and long-term investors can keep this stock on the radar for the upcoming sessions.

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