Hey everyone,
I’ve been tracking Hindustan Zinc ($HINDZINC) on the weekly charts, and the price action is looking like a textbook Wyckoff Accumulation breakout. After a massive sideways range lasting nearly a year and a half, we are finally seeing the “Composite Man” start the markup phase.
The Wyckoff Breakdown:
- Phase B (The Cause): From 2023 through most of 2024, the stock built a massive “Cause” (sideways range). Wyckoff’s Law of Cause and Effect suggests that the longer the base, the more explosive the breakout.
- Phase C (The Test): We saw a bottom around ₹375 in Q1 2024. This acted as a successful test of the range lows, showing that supply was exhausted and absorbed.
- Phase D (SOS – Sign of Strength): This is what happened very recently. The stock broke the major resistance at ₹525 with high conviction.
- Effort vs. Result: Last week’s volume was 75 million, which is significantly above the average. This shows “Harmonious” price action—large volume (Effort) resulting in a large price move (Result).
Relative Strength (RS) Highlights:
One of the most bullish signals is the Relative Strength Index against the benchmark:
- vs. CNX Metal Index: HINDZINC is currently a sector leader, outperforming the metal index.
- vs. BSE 500: It is showing significant alpha compared to the broader market, making it a high-probability candidate for a sustained uptrend.
The Strategy:
- Current Entry: The breakout above ₹525 is the primary signal.
- Target: Based on the previous peak and range depth, a return to ₹750 is on the cards. Note: This is a swing trade/positional play, so expect it to take weeks or months, not days.
- Support: The previous resistance at ₹525 should now act as a floor (LPS – Last Point of Support).
Sector Context: Metals are looking like the leading sector for the upcoming weeks. With silver prices also showing strength, HINDZINC (as a pure-play silver producer in India) has a double tailwind.
What do you guys think? Is anyone else riding the metal trend or seeing the same accumulation pattern here?