L&T witnessed sharp rally over last few trading sessions and shot up from 791.7 (19th May) to 974.15+ (1st June). This rally may be attributed to expiry short covering. Nevertheless, it was a strong move which attempted a breakout of previous high 943 on 20th April, on a closing basis.
However, there was heavy resistance and L&T witnessed selling pressure to close at 928.15. It is currently following a HH - HL pattern on daily chart which may get negated if L&T closes below 810-815 levels, which again will act as a strong support.
Now, in order to enter the short trade one must wait for a reversal in RSI which is still above 60. ADX looks neutral and can indicate consolidation in the near term. A short term sell with today's high 974.15 as SL can be initiated on L&T.
However, there was heavy resistance and L&T witnessed selling pressure to close at 928.15. It is currently following a HH - HL pattern on daily chart which may get negated if L&T closes below 810-815 levels, which again will act as a strong support.
Now, in order to enter the short trade one must wait for a reversal in RSI which is still above 60. ADX looks neutral and can indicate consolidation in the near term. A short term sell with today's high 974.15 as SL can be initiated on L&T.