Indoagri – Threading in a narrow range

Trend: Uptrend, 20ma up, MacD above 0

Support: 2.16 (20ma), 2.06 (200ma)

Resistance: 2.25 (50 & 100ma close), 2.32

Observations
Candlestick – Black candle
Histogram – 3R. No bearish divergence.
RSI – At 50%. No bearish divergence.
Stochastic – No bullish cross. Around 30%.
Bollinger Band – Trading at mid band. Squeeze.

Conclusion:
Indoagri has been trending well for the past few weeks and it trading range start to get narrower. This could be due to the compression of the moving average lines recently. What is needed now is for it to break away from this narrow range before it could trend well again. So what are the chances?
Looking at yesterday’s chart, Indoagri had shown a clear uptrend with indicators also confluence with the trend. But recently, it got resisted by both 50 & 100ma at around 2.25 level and retraced to 20ma yesterday. 20ma could be a key level for a formation of a higher low. But based on the candlestick, there is still no sign of bullishness.
If Indoagri is to bounce off from this support level of 2.16, it will meet 50 & 100ma resistance again. Hence, in order to for more upside to be seen, it must break these 2 resistance level before we can see the next resistance of 2.32 level. Currently, the indicators did not indicate any signs of bullishness yet. On the other hand, if 20ma fails to hold, it might approach the 200ma as support and then trend might turn into a sideway trend by then.
With such a tight range that Indoagri is trading, it can be tough to make a trading decision. But if indoagri breaks 50 & 100ma, it will be easier to make a decision. Or alternatively, if 200ma fails to hold, downtrend could continue.
What to watch out for this week:
1) Breakout of 2.25 resistance with more than 40mil volume
2) Bounce off from 20ma and resisted by 50 & 100ma.

Trading strategy to adapt right now:
- Long when there is a breakout of 2.25 with high volume
- Short when 2.08 breaks with high volume.

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