Nifty on the daily chart has formed a double top pattern at around 15,900.
Momentum oscillator RSI (14) has drifted lower from 70 level which is an overbought zone for the indictor and it has given a breakdown of a horizontal trendline and settled below 60 level with bearish crossover on the daily timeframe.
The recent fall in the Nifty50 was arrested near its 21-day exponential moving average, which is placed at 15,597 - an important short-term support level for the index.
Looking at the current chart set up, we are expecting a volatile movement with a bearish tilt in the coming trading sessions.
Near-term support for the index is placed near 15,450 and upside is capped near the 15,900 – 16,000 zone.
Here are two buy and one sell call for the next 2-3 weeks:
IRCTC | Buy | LTP: Rs 2,083.95 | Target price: Rs 2,200 | Stop loss: Rs 2,015 | Upside: 6%
IRCTC was trading in a range of Rs 2,100 – 2,000 for the last ten trading sessions and formed a smaller degree falling channel pattern on the daily chart.
Prices have given a decisive breakout of a Pole flag pattern and are currently hovering above the upper band of the flag pattern on the daily interval.
Prices have given horizontal trendline breakout on the weekly chart which is positive for the medium-term trend.
The stock has witnessed an above-average volume activity during the breakout which indicates price volume breakout on a daily scale.
The stock is trading above its 50 and 100- day exponential moving averages on the weekly timeframe, which is positive for it in the near term.
Momentum oscillator RSI (14) is reading above 60 level with positive crossover, looking to accelerate higher on the daily and weekly intervals.
Maharashtra Seamless | Buy | LTP: Rs 311.50 | Target price: Rs 334 | Stop loss: Rs 299 | Upside: 7%
This stock had been trading in a range of Rs 290 to Rs 310 for almost two months and has formed an inverted head and shoulder pattern on the daily chart.
It broke out of an inverted head and shoulder pattern at Rs 315 on June 16 and registered a decisive breakout that suggests a change in the trend from sideways to upside.
It has also completed its throwback near its neckline in its recent pullback.
The stock is trading above its 21, 50 and 100- day exponential moving averages on the daily timeframe, which is positive for the counter in the near term.
The MACD indicator is above its centerline with a positive crossover above its signal line. Momentum oscillator RSI (14) is reading near 60 level which indicates positive momentum will continue ahead.
Asian Paints | Sell | LTP: Rs 2,995 | Target price: Rs 2,820 | Stop loss: Rs 3,065 | Downside: 6%
This stock has given a rising wedge pattern breakdown on the daily timeframe and is currently trading below the trendline resistance.
The counter has also formed a bearish engulfing candlestick pattern on the daily chart and the pattern has been formed near an all-time high level which adds more impact to the said bearish pattern.
Momentum oscillator RSI (14) has drifted from 70 level which is an overbought zone for the indicator and has given a negative crossover on the daily timeframe.
(The author is a technical analyst at Bonanza Portfolio)
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