Three large-cap stocks breaking out on charts


Amid this bullish outlook, several large-cap stocks within the Nifty100 are making significant technical breakouts, attracting attention from investors. Here’s a closer look at three standout performers:

ICICI Bank

ICICI Bank, one of India’s largest private-sector lenders, is renowned for its robust digital banking initiatives and consistent improvement in asset quality, making it a favourite among investors.

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From a technical perspective, ICICI Bank has recently broken out of a symmetrical triangle pattern on its daily price chart. This pattern often signals a phase of consolidation before a decisive price move, and its breakout typically indicates the onset of a strong trend. The significance of this move is amplified by its alignment with the Fibonacci Time Cycle theory.

PP_1733746876079 Three large-cap stocks breaking out on charts

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ICICI Bank Daily Chart (Source: TradePoint, Definedge)

The breakout occurred precisely at the 50-bar Fibonacci Time Cycle mark, an important technical signal that often marks the end of consolidation and the start of sustained bullish momentum.

Adding to the bullish sentiment, the breakout coincides with a reversal from the 62-Day Exponential Moving Average (DEMA) channel, calculated using the moving averages of high and low prices. The stock’s ability to hold above this critical support before surging higher reinforces the strength of its upward trajectory.

The chart structure suggests that ICICI Bank is on the verge of entering uncharted territory, with further upside potential in the coming weeks.

Larsen & Toubro

Larsen & Toubro (L&T), one of India’s largest and most diversified conglomerates, has a formidable presence across sectors such as technology, engineering, construction, manufacturing, and financial services. As a cornerstone of India’s industrial growth, L&T plays a pivotal role in driving infrastructure, defence, and power projects.

From a technical standpoint, L&T’s weekly price chart has recently showcased a breakout from a diamond pattern, one of the rarest and most potent chart formations. This pattern, characterized by two converging trendlines that form a distinct diamond shape, often emerges after a consolidation phase. A breakout from this pattern signals a significant shift in market sentiment, typically leading to sharp price movements.

PP_1733747119933 Three large-cap stocks breaking out on charts

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L&T Weekly Chart. (Source: TradePoint, Definedge)

For L&T, the breakout above the diamond’s upper trendline indicates a decisive upward momentum. The chart structure suggests that the stock is poised for a substantial rally, with the potential to explore new highs in the weeks ahead.

The Indian Railway Finance Corporation (IRFC) serves as the dedicated financing arm of Indian Railways, one of the world’s largest railway networks. Tasked with raising funds through bond issuances, IRFC plays a crucial role in financing the expansion and modernization of this vital infrastructure. Backed by the Indian government, IRFC represents a stable investment option, benefiting from its strategic importance to the country’s long-term growth.

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On the Daily 1% X 3 Point & Figure chart, IRFC has recently broken out of a 4-column triangle pattern. This pattern, a cornerstone in point-and-figure charting, signifies an extended period of consolidation, with price movements confined within a defined range. A breakout from this structure typically signals the end of consolidation and the onset of a new trend.

PP_1733747449445 Three large-cap stocks breaking out on charts

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IRFC Daily P&F Chart. (Source: TradePoint, Definedge)

In IRFC’s case, the breakout indicates a potential shift into a new phase of upward momentum. Supported by the government’s sustained focus on infrastructure development, IRFC is well-positioned to capitalize on long-term growth opportunities, reinforcing its appeal as a reliable investment choice.

For more such analysis, read Profit Pulse.

To conclude, three stocks—ICICI Bank, Larsen & Toubro, and IRFC—are potentially poised to capitalize on strong technical and fundamental factors, making them stocks to watch in the coming months for potential substantial price gains.

Note: This article aims to share interesting charts, data points, and thought-provoking opinions. It is not intended as investment advice. If you are considering making an investment, please consult your financial advisor. The content is strictly for educational purposes.

About the author: Brijesh Bhatia brings over 18 years of experience in India’s financial markets as a trader and technical analyst. He has worked with esteemed organizations such as UTI, Asit C. Mehta, and Edelweiss Securities. Currently, he serves as an analyst at Definedge.

Disclosure: The writer and their dependents do not hold the stocks discussed in this article. However, clients of Definedge may or may not own these securities.

 



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