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Trade Spotlight: Bharat Forge, Ashok Leyland & Hind Copper in focus

Stocks like Bharat Forge rallied over 9 percent, Ashok Leyland gained more than 5 percent while Hindustan Copper closed with gains of over 7 percent in a subdued market.

January 08, 2021 / 08:30 AM IST
 
 
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Indian market fell for the second consecutive day in a row on January 7 but closed with marginal losses as bulls helped benchmark indices to recoup some losses towards the end of the trade.

Let’s look at the final tally on D-Street – the S&P BSE Sensex was down 80 points to 48,093 while the Nifty5o closed 8.9 points lower at 14,137.

Sectorally, the action was seen in metals, telecom, capital goods, as well as realty while profit-taking was seen in FMCG, IT, power, and healthcare stocks.

Stocks like Bharat Forge rallied over 9 percent, Ashok Leyland gained more than 5 percent while Hindustan Copper closed with gains of over 7 percent in a subdued market. All three stocks hit a fresh 52-week high on Thursday.

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We have collated views of experts on what investors should do when the market resumes trading on January 8:

Shrikant Chouhan, Executive Vice President, Equity Technical Research at Kotak Securities:

Bharat Forge:

The stock has rallied by 9 percent on January 7. On Thursday, the stock opened with a gap on the higher side and then quickly surpassed Wednesday’s high with strong volume activity.

Despite tepid market conditions, Bharat Forge maintained its strong momentum throughout the day. In the short-term time frame stock has formed a strong price volume breakout pattern.

The texture of the pattern suggests that the breakout action will continue in the near term if the stock succeeds to trade above Rs 570 level.

For the swing traders, the level of Rs 570 should be the sacrosanct level, and if it trades above the same then we can expect the uptrend to continue up to Rs 650-665.

Ashok Leyland:

On January 7 the stock made yet another 52-weeks high of Rs 111.80.  In this month so far, it has rallied over 16 percent. The important point is that the stock has not only surpassed its previous 52-week high of Rs 102.10 but comfortably managed to sustain above it.

The surge in the price action surprised most of the traders. On the daily as well as on the weekly charts, the stock has formed a breakout continuation pattern which is grossly positive for Ashok Leyland.


For the next few trading session, the level of Rs 105 and Rs 102 should be the trend decider level for the bulls. If the stock sustains above the same, we can expect a continuation of the uptrend up to Rs 119. Further, the uptrend may also continue which could lift the stock to Rs 126.

Hindustan Copper:The stock has rallied over 100 percent in the last quarter. Post strong uptrend rally from Rs 30 to Rs 65, the stock was trading in a narrow range.

But, on Thursday, after a strong opening, bulls once again took the charge. This along with a sharp incremental volume activity helped Hindustan Copper gained 8 percent.

On the weekly charts, the stock has formed a strong bullish candle along with strong modest volume activity clearly suggests the uptrend will continue in the short run.

Further, on daily charts, the stock has formed a higher bottom series pattern which suggests a strong bullish structure for the medium term.

For the positional traders, Rs 62 should be the key level to watch. If the stock manages to trade above the same, we can expect an uptrend continuation wave up to Rs 80-85.

Disclaimer: The views and investment tips expressed by experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.

 
Kshitij Anand is the Editor Markets at Moneycontrol.

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