Pidilite Forms A Double-Bottom Pattern Hinting At A Near-Term Bullish Reversal; Check The Details

Synopsis: Pidilite Industries Ltd has formed a double-bottom pattern on the 1-hour chart, indicating a potential near-term bullish reversal.

The emergence of a double-bottom pattern after a prolonged decline highlights strong buying support at lower levels. A breakout above the neckline signals the potential for a bullish trend reversal.

The double-bottom pattern suggests a potential trend reversal after a prior decline, marked by two similar lows around a key support area. A clear breakout above the neckline indicates strengthening buying interest, signalling waning seller control and the potential for upside momentum to build.

On Thursday, Pidilite Industries Ltd formed a double-bottom pattern on the 1-hour chart and decisively broke above the neckline, backed by improving buying interest. Sustained trading above this level could reinforce upside potential and further confirm the near-term trend reversal.

In a double-bottom formation, upside targets are typically derived from the immediate resistance levels above the neckline. These zones are often used by traders for partial or full profit booking, while closely monitoring price action for continuation or early signs of exhaustion.

Pidilite Industries Ltd Chart: 1-hour Timeframe

Indicator Confirmation

• RSI: The daily RSI indicates bullish momentum, as it rose from 50 in the previous trading session to 53.80 on Thursday, confirming the continuation of the reversal.
• MACD: On 1-hour time frame, the Blue MACD line crossed above the orange signal line, with the histogram turning green, indicating bullish momentum.
• Moving Averages: On the 1-hour time frame, the 5-day moving average has crossed above the 9-day moving average, further confirming a bullish trend.
• Price Volume Trend: The Price Volume Indicator confirms the uptrend, supported by a sharp increase in buying volume.

Implications

The formation of a double-bottom pattern signals potential upside. A sustained close above the crucial Rs 1,468 level, ideally supported by stronger buying volumes, would validate the reversal and reduce the likelihood of a false breakout. With the earlier resistance near Rs 1,468 now turning into immediate support, holding above this zone would strengthen near-term bullish momentum.

About the stock

Pidilite Industries Ltd is a leading Indian manufacturer of adhesives, sealants, construction chemicals, DIY products and polymer emulsions. Its portfolio spans paint, automotive and industrial chemicals, art materials and fabric care, supported by strong in-house R&D. The company owns iconic brands such as Fevicol, M-Seal, Fevikwik, Dr. Fixit, Araldite and Fevicryl.

Over the past month, Pidilite Industries Ltd has slipped 2.15%, indicating ongoing weakness. Over a six-month period, the stock has edged down 1.74%, though it continues to show a modest year-on-year gain of 1.95%. For more such technical stock ideas, click here to view our research page.

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