Last week, the market registered a new high of 12,769.75 which was followed by some consolidation ahead of the Muhurat trading session.
Eventually, the market concluded above the 12,700-mark by adding nearly four percent on a weekly basis.
In the next-to-last week, we had witnessed a ‘Bullish Flag’ breakout around 12,050 and since then, the market never looked back.
With its marathon rally in merely eight days, markets are very much in a commanding position.
From hereon, we can see a brighter picture till the next Samvat.
Looking at the daily chart, we can observe a couple of encouraging developments on charts.
The ‘RSI-Smoothened’ is moving northwards after entering the bullish territory above 70 and adding to this, the ‘ADX (14)’ is becoming stronger as we can see its value rising well above the 25-mark.
Generally, when we see these conditions together, it provides impetus to the rally.
Hence, any dip towards 12,600 – 12,450 should be used as a buying opportunity.
On the upside, the next milestone of 13,000 is likely to be achieved very soon. In fact, we do not rule out the possibility of reaching 13,100 – 13,200 in the forthcoming week itself.
Traders are advised not to expect any meaningful correction in the near future and hence, do not venture into taking contradictory bets in such a strong bull-run.
We are sounding extremely optimistic because almost all major sectors are contributing to this surge and hence, can be considered a robust one.
The broader market has also started to give some mesmerising moves and mind you, this is just the beginning of the mega bull run.
So fasten your seat belts and gear up to take off post-Diwali as well.
We take this opportunity to wish you all a Happy as well as Healthy Diwali and a prosperous New Year.
Here are three buy calls for the next 2-3 weeks:
Deccan Cements | LTP: Rs 338.40 | Target price: Rs 380 | Stop loss: Rs 324 | Upside: 12%
The entire cement space has been on a roll for the last couple of months. All larger names have given strong moves in this period and now some of the smaller stocks are gaining traction.
Deccan Cement has confirmed a good price-volume breakout on daily charts.
The kind of extraordinary volume activity we have witnessed in the up move in recent months indicates some bigger moves to unfold and this probable rally seems to have just begun now.
LIC Housing Finance | LTP: Rs 314.05 | Target price: Rs 342 | Stop loss: Rs 298 | Upside: 9%
This one of the traders’ favorite counter has not participated much in the overall rally in the last few months.
However, recently we witnessed some encouraging signs as the stock prices finally managed to come out of its long consolidation phase.
During the week, it confirmed a price volume breakout from the multiple resistance zone along with reasonable volumes.
The stock has managed to spend more than 15 consecutive trading sessions above the 200-day SMA for the first time after July 2019, which is an extremely positive development for this counter.
This stock recently entered into the F&O space, but after this, we did not see any action in the stock for a while.
It just rested around the 200-day SMA for nearly two months, because of a lack of participation from the market participants.
But on Friday, we finally witnessed a notable price action in the upward direction.
This up-move is backed by more than average daily volumes and hence, we expect the stock to be back in action in the coming days.
(The author is Chief Technicals & Derivatives Analyst at Angel Broking)
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.
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