Nifty50 on June 2 started the day on a flat-to-negative note and registered its intraday low at 15,459.85.
Later, it saw a recovery and finally witnessed a smaller degree downward sloping trendline breakout in the intraday chart and closed above 15,550 near its prior day’s closing.
The benchmark index has also given a decisive breakout of a rising wedge pattern on the daily scale and currently, it has sustained above its upper band of the pattern.
As we can observe on the monthly chart, Nifty has not seen any serious correction since March 20, which indicates a strong bull market is on the cards.
India VIX closed one percent lower at 17.21 level. It continues to trade in lower high lower low formation and has sustained below 19 level.
VIX index settling below 20 level indicates a drop in the volatility which creates confidence among the traders.
Momentum oscillator RSI (14) continues to move in the positive zone which is placed above 65 level with bullish crossover on the daily interval.
The 21-day exponential moving average is placed just near the lower band of the rising wedge pattern and acting as a crucial support zone near the 15,150 level.
The current trend suggests bull run in the market is most likely to continue as the index has given breakout in the broader timeframes.
Support for the Nifty is placed near 15,250 while resistance is pegged near 15,800.
Here are three buy calls for the next 2-3 weeks:
Indraprastha Gas | LTP: Rs 531 | Target price: Rs 566 | Stop loss: Rs 510 | Upside: 7%
This stock has been trading in a range of Rs 500 to Rs 520 for almost two months and has formed ascending triangle formation on the daily chart.
It has broken out of an ascending triangle pattern at Rs 528.80 level on May 31 and the prices have registered a decisive breakout that suggests a change in the trend from sideways to upside.
It is trading above its 21, 50 and 100- day exponential moving averages on the daily time frame, which is positive for the prices in the near term.
There has been above-average volume on the day of the breakout which confirms price-volume breakout on the daily timeframe.
Momentum oscillator RSI (14) is reading near 60 level with positive crossover on the daily scale, which indicates the uptrend may resume soon.
ICICI Prudential Life Insurance Company | LTP: Rs 565.65 | Target price: Rs 598 | Stop loss: Rs 549 | Upside: 6%
This stock has witnessed a horizontal trendline breakout on the weekly chart and post-breakout prices retested their trendline support and completed their throwback.
It has given a decisive breakout of a falling channel pattern and is currently hovering above the upper band of the falling channel pattern on the daily interval.
The counter has been trading in a higher high higher bottom formation on the weekly chart for more than 12 months which indicates bulls are still in action.
The stock is trading above its 21, 50 and 100- day exponential moving averages on the daily timeframe, which is positive for the prices in the near term.
Momentum oscillator RSI (14) is reading above 55 level with positive crossover, looking to accelerate higher on the daily interval.
Aditya Birla Fashion and Retail | LTP: Rs 199.20 | Target price: Rs 210 | Stop loss: Rs 192.50 | Upside: 5%
This stock has been trading in a higher high higher bottom formation on the daily chart since April 19.
It has witnessed a horizontal trendline breakout at Rs 197.55 on June 1.
On the weekly scale, it is trading above its upward slanting trendline which is supported by a 50-day exponential moving average.
It is in the accumulation phase as we can observe an above-average volume activity on the positive closing days.
Prices are reading above the parabolic SAR indicator which is acting as crucial support for the counter.
(The author is a technical analyst at Bonanza Portfolio)Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.