In the Indian stock market, retail traders and investors often look for high-potential opportunities. One such opportunity arises when stocks that have fallen for a long time begin to form signs of a reversal. In this article, we examine three stocks that appear on our radar poised for upside after prolonged down-moves, based on clear technical signals. While the pattern is not a guarantee, it offers a structured way to spot potential breakout candidates. We will guide you in simple language, with clarity and precision so you can interpret the setup and decide for yourself.
Common Setup seen in these Stocks
All four
stocks discussed share the following setup:
They went
through a prolonged down-trend characterized by lower highs and lower lows.
During
that period, the RSI dropped below 40, signaling weaker momentum.
Price was
trading below the 20 EMA most of the time.
Recently,
they stopped making lower lows (they are consolidating).
RSI is
trying to cross from below 40 toward 50.
Price has
already recorded a closing above the 20 EMA on daily charts.
All these
four stocks formed same type of chart patterns on daily timeframe. This setup
suggests the down-trend may be over (or pausing) and an upward phase could
start, if the broader market cooperates.
Stock 1: PI Industries Ltd (PIIND)
PI
Industries is a large-cap agro-chemical company in India.
It had
been in a down-move (lower highs, lower lows) and RSI reportedly dipped below
40, price remained under the 20 EMA.
Recently
the price has consolidated, stopped new lows, and has delivered a daily closing
above the 20 EMA (per our analysis).
Why this
matters: when a quality business like PI Industries begins to show a technical
rebound, it may attract renewed buying.
Note:
While the fundamental business is strong (ROCE ~22.9%, P/E ~33.7).the success
of the trade will depend on market conditions aligning.
Practical
takeaway: If you see further confirmation (e.g., price takes out a recent
high, volume picks up) one can consider initiating a position with defined
stop-loss below recent consolidation lows.
See the chart below;
Stock 2: KPIT Technologies Ltd (KPITTECH)
KPIT
Technologies is an India-based embedded software company in the
automobile/mobility space.
The
down-trend (lower highs/lows) gave way to a consolidation. RSI rose from below
40 toward 50 and price closed above the 20 EMA (based on our analysis).
Why this
setup is interesting: The mobility/tech sector may attract growth money, and a
technical rebound could be timely.
Practical
takeaway: Because KPIT is more volatile, position size should be smaller. Use a
stop-loss just under consolidation support and look for breakouts above prior
swing highs to confirm.
See the chart below;
Stock 3: Crompton Greaves Consumer Electricals Ltd
(CROMPTON)
Crompton
Greaves is a consumer-electrical business in India.
The stock
has experienced a down-move, then consolidation. RSI behavior (below 40 then
rising) and closing above 20 EMA fit the described pattern (per your analysis).
Why this
is compelling: Consumer durables often respond when demand picks up or cost
pressures ease. A technical rebound in that context may lead to strong upside.
Practical
takeaway: Monitor the news for catalysts (product launches, margin
improvement). Enter when momentum is clear (e.g., price crossing a resistance
level). Set a stop-loss tied to recent lows, and define target levels (e.g.,
previous swing highs).
See the chart below;
Stock 4: PB Fintech (Policibzar)
PB Fintech Ltd. popularly known as Policibazar is India's largest online
platform for insurance and loans.
It had been in a down move for a prolonged period of time, RSI below 40
level and price remained below 20 EMA.
Recently the stock stopped making new lower low pattern and has given a
closing above 20 EMA. RSI is also approaching towards 50 from below 40.
When a quality business like Policybazar shows a reversal signal it may
attract new buyers.
Although the fundamentals of the company is strong, but the success of
the trade depends on overall market conditions.
If some other indicators confirm the trend for upside one can
initiate trade in the stock with tight stop loss.
See the chart below;
Risks and Caveats
Technical
patterns are not guarantees: Even when setups look perfect, external factors
(macro‐economy, sector weakness, and policy changes) can derail the move.
Confirmation
is key: A false breakout above 20 EMA may reverse. Waiting for volume or
multiple days of strength helps.
Broad
market matters: If the overall market is weak, even well-set stocks may
struggle.
Fundamentals
still matter: If the business deteriorates or earnings disappoint, technical
patterns may fail.
Stop-loss
discipline: Without a stop‐loss you risk large losses.
Bias
risk: Because you believe a pattern exists, you may ignore signs that it is
invalid. Always remain objective.
Conclusion
For
retail traders and investors, spotting stocks that are ready to reverse after
prolonged declines offers a structured way to hunt for gains. The three stocks
discussed here—PI Industries, KPIT Technologies and Crompton Greaves Consumer
Electricals—fit a recurring pattern: down-trend, RSI weakness, consolidation,
then a break above 20 EMA. If the market environment supports them, they may
move upward. However, success depends on discipline: define your entry, set
your stop-loss, monitor momentum and adjust if conditions change. Use the
method, not the hype, and trade with risk control. Keywords: breakout setup,
reversal pattern, retail trading, technical analysis.
In all these 4 Stocks our stop-loss will be one candle close below 20 EMA.
Disclaimer: The information provided on MoneyWiseMind is for information purposes only, not a buy or sell recommendation. Please consult a licensed financial advisor before making any financial decisions.
