Stock Defies Market Gloom; Rallies 8%, Volume Soars 350%!

  • Stock Market Analysis

The global markets are having a tough time since the US Fed chairman Jerome Powell expressed his hawkish stance in the Jackson Hole Symposium on continuing to increase interest rates till inflation comes under control. The Nifty 50 is currently trading 1.39% lower at 17,313 by 11:03 AM IST but there is one stock that is providing investors some cover to hide in this gloomy market and that is Hathway Cable and Datacom Ltd (NS: HAWY ).  

The company is a cable and D2H service provider and has a market capitalization of INR 2,982 crores. The stock trades at a book value of less than 1, at 0.72 and its P/E ratio stands at 22.95. Today the share price of Hathway surged over 8% to INR 18.2 as investors flee to buy the company’s shares despite a not-so-good day for investors. A stock’s real strength is known in such times when the pessimism is quite high but still the stock rakes up heavy gains for investors.

Image Description: Daily chart of Hathway Cable and Datacom

Image Source: Investing.com

Today’s rally has also materialized into a 2.5-month long range breakout on the daily chart. After trading directionless for the last couple of months, the stock finally breached the upper resistance range of INR 17.75 with a high force. The force is measured by the volume behind the breakout as it gives an indication of the reliability of the breakout. The higher the volume behind a trending move (be it up or down), the higher is the strength of the move. In the case of Hathway, the stock clocked a volume of 9.99 million shares so far, which is 347% higher than the 10-day average volume of 2.23 million shares (noted yesterday).    

Now as the stock seems to have finally changed its trend from sideways to uptrend, a continuation of the rally could easily be expected, especially if the broader markets recover from here. In the last one year, the Hathway shares took a heavy beating, falling over 28%, therefore a bounce-back rally from here could be sharp and quick. On the upside, the stock could travel to the nearest resistance of INR 21.5 to INR 22 in the near future. There is a minor hurdle around INR 18.5 but that doesn't seem to be strong enough to halt the current move.

On the downside, there is good support around 16.5, below which the rally could be deemed to have failed. 

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  • kirpal setia @kirpal setia
    sorry expiry 17450
    Like 0
  • kirpal setia @kirpal setia
    nifty today 17450
    Like 0
  • AV CARE FOR YOUR MONEY @AV CARE FOR YOUR MONEY
    This is not a breakout.
    Like 0
  • Deependra Singh @Deependra Singh
    how you find these consolidating stocks ??
    Like 0
    • Aayush Khanna/Investing.com @Aayush Khanna/Investing.com
      Hi Deependra, I use InvestingPro.
      Like 0
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