The Indian market recouped losses and closed more than 1 percent higher for the week ended October 23, with the S&P BSE Sensex reclaiming 40,000 and the Nifty closing above 11,900.
The Nifty50 rose 1.4 percent while the Sensex gained 1.7 percent for the week compared to a 2.4 percent rally in the S&P BSE midcap index and a 2.35 percent in the smallcap index during the period.
The market is likely to remain volatile as we step into the F&O expiry week and in the run-up to US elections. FIIs have been net buyers, so far, and that will help sentiment.
Experts, however, have called for caution as selling pressure can come in at higher levels, though the recent earnings from India Inc have been strong and the companies sound optimistic about the future, which is a positive sign.
“The Nifty 50, after a swift rally, is consolidating around resistance levels of 12000, which is an important level from the market as well as option writers' perspective. The short-term support is now placed at 11,600,” Umesh Mehta, Head of Research, Samco Group told Moneycontrol.
“As the market is getting rejected at higher levels and global equity indices have underperformed our bourses, the key event the entire world is waiting for is the US presidential elections but till then, markets could remain in the status quo. This month’s expiry is likely to be below 12,000 strikes.”
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Expert: Sacchitanand Uttekar, DVP–Technical (Equity) at Tradebulls Securities
Bharti Airtel witnessed a corrective move during the entire last quarter, as it declined from Rs 580 to Rs 400 in a lower-top lower-bottom sequence.
The sequence seems terminated as the stock witnessed an ‘Engulfing Bullish’ candlestick formation for the first time since the beginning of its corrective action.
The place of the pattern is also important as it occurred at a 200-WEMA level alongside the positive divergence displayed on its daily scale for the last few days.
Trading, as well as folio longs, should be considered from hereon with a stop below Rs 400 for a rebound back to its 20-WEMA placed around 490 zone.
A positive sector outlook and a breakout from a ‘V’ shaped pattern on its weekly scale, with weekly RSI trending comfortably above its 50-mark, the stock saw a significant jump in delivery volumes in the week gone by.
On the other hand, option writers around 400 CE strike seemed to have been pushed farther away as the bound shifted higher to 420 while fresh additions at 400 PE strike reaffirms the shift in support.
Though the weekly scale pattern indicates a price target up to 485 and the momentum is expected to amplify once again above 420, which could be participated with by building fresh longs for the next few weeks with a stop below 402 for an initial up move towards 445.
On its weekly scale, L&T has been holding well within its ongoing upward rising channel pattern formation. The spike reconfirmed the strength in its pattern support, as the stock didn't close below the same after September 25 and has since been holding well above Rs 900-mark.
The recent rebound from this support was well infused with volumes as the price formed yet another bullish candlestick, Engulfing Bullish, on its weekly scale.
With its weekly RSI on the verge to break above 50, we may soon witness the stock to rise above its 200-DEMA zone placed around 1005.
Trading longs should be added with a stop below 905 for a rebound back to the channel resistance placed around 1060.
CRISIL: Buy| LTP: Rs 1937| Target: Rs 2340| Stop Loss: Rs 1820| Upside 17%
Fresh breakout from a Flag formation on its weekly scale indicates that the ongoing upmove will continue further. The breakout was well supported with significant volumes which were up by nearly 3 times above its 5 weeks average volumes.
Momentum expected to stretch towards the pattern target up to 2340 which could be participated with a stop below 1820 from hereon.
Amara Raja Batteries: Buy| LTP: Rs 761| Target: Rs 810| Stop Loss: Rs 720| Upside 6%
On its daily scale, the stock has been oscillating within a ‘Broadening formation’ with its higher-end been placed at 810.
The latest crossover in its short-term averages along with its ADX rebounding from its support rage warrants fresh momentum. Fresh longs could be added with a stop below 736 for a move towards 810.
Positive sector outlook along with the confirmation of a Bullish hammer formation on its weekly scale.
The developing Hammer formation on its monthly scale is another good sign of the broader support in place as the stock managing to hold above its 20 Months EMA zone.
Trading, as well as folio longs, should be considered for a strong recovery towards 465 with a stop below 365 from hereon.
Expert: Expert: Sameet Chavan, Chief Technical & Derivatives Analyst at Angel Broking
After a spectacular rally in July-August, the auto and auto ancillary space went into a consolidation mode.
However, on October 23 almost all stocks from this place took off and kept buzzing throughout the day.
Bharat Forge, in the last couple of months, had more of a time-correction than the price-correction.
It rested around the 89-EMA on the daily chart for some time and finally, witnessed a huge breakout from the consolidation phase along with sizable volumes.
On the weekly timeframe, the stock is yet to surpass the 200-SMA, but the way it is placed now, we expect it to go beyond Rs 520 – 530 in this leg of the rally.
We recommend going long on a minor dip towards Rs 488–Rs 483 for a target of Rs 520-530 in the coming days.
This stock was once traders’ favourite but after it was excluded from the F&O universe, it has mostly remained unnoticed.
But the way this stock posted a decent rally on October 23 to confirm a weekly breakout, it would really be unfair not to cover this stock in a recommendation list.
In this pandemic time, the stock seems to have formed a strong base and has gradually developed a price configuration that resembles a ‘Bullish Saucer’ pattern.
This is known as a good ‘accumulation’ pattern and a breakout above this with volumes is likely to provide thrust in the coming days.
Expert: Gaurav Ratnaparkhi, Senior Technical Analyst, Sharekhan by BNP Paribas
The stock had a short-term correction in the last few sessions and found support near the key daily moving averages.
After taking the support, the stock started a fresh move on the upside in the last session. The price action in the last session was supported by strong volumes, which is a bullish sign.
Dabur India: Buy| LTP: Rs 518| Stop Loss: Rs 500| Target: Rs 535-564| Upside 8%
Dabur India is moving up in a medium-term rising channel. The recent dip in the last week found support near the lower end of the channel. The stock is now trading closer to its support and is expected to resume the larger uptrend.
The stock is on an upward trajectory. After a brief consolidation in the last few session, the stock is set for an extension and that too on the upside. The short-term & medium-term momentum indicators are in a bullish mode
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