Wednesday, 3 January 2018

Bharat Petroleum – Technical Analysis

Article by : Prof. Tamal Dutta Chaudhuri, Principal, Calcutta Business School

In this post, we will look at a few technical indicators and understand whether Bharat Petroleum Corporation Limited is a good buy on Tuesday, 26.12.2017.

Figure 1 shows that there is a clear upward channel formation and prices should hit Rs.570 levels. There is some money to be made. The linear regression line is also upward sloping indicating that Rs.550 level is achievable. However, note that we are at the end of 7 waves, and there should be a technical correction - so get in fast and get out fast.

Figure 1

Given the price movement, understandably, in Figure 2 the price is climbing along the upper band of the Bollinger Band. The price has just crossed the 0 MACD line and is marginally overbought. It is also giving a buy signal. However, RSI is quite high around 70, but a bit of a bull steam is left.

Figure 3 is interesting. The Parabolic SAR line is starting to catch up with the series indicating some upward rise in prices. Stochastics, however, a bit broad based on a 10 day period, has already given a sell signal. The upward rise is losing steam.

Momentum in Figure 4 has shown a short break and Mesa Sine Wave is signaling a sell.

Figure 2

Figure 3

Figure 4

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