Tata Power Share Price is Rising. Is Now the Time to Buy?
Tata group company. Before delving into Tata Power's charts, it’s important to note that the broader BSE Power index has also confirmed a bullish trend. The BSE Power index chart portrays a northward movement.
It starts from the confluence of long-term horizontal support, the 200-week exponential moving average (WEMA), and the 50% Fibonacci retracement level. Also, several chart patterns and indicators suggest that the bulls are in control of the trend, ending a prolonged consolidation period. I recently recorded a video on power stocks and explained whether it’s the right time to invest in the sector.
Multiple patterns are signalling the stock is breaking out of the consolidation zone. Bulls may take control of the trend for the medium term. The stock exhibited accumulation above the 50-week exponential moving average (WEMA) depicted in green in the above chart.
This is a positive sign for Tata Power share price as it signifies increasing demand and investor interest. The horizontal trendline (shown in black), represents the previous swing low at ₹190, serving as a crucial support zone. In March 2023, the stock experienced a breach below this support level but remarkably reversed its direction sharply indicating a potential shakeout or breakdown failure.
The reversal presented a favourable opportunity for the bulls, as they took charge and successfully reclaimed the ₹200 mark. The swift recovery above the previous support level suggests a potential shift in sentiment and may signify renewed bullish momentum in the stock. The Bollinger Bands (orange), which represent the stock's volatility, witnessed an expansion after 38 weeks of remaining in a narrow band.
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