Indian market witnessed profit-taking at higher levels on Wednesday and the trend is likely to remain volatile on Thursday as well ahead of June F&O expiry.
The final tally on D-Street on Wednesday – the S&P BSE Sensex fell 421 points to 38071 while the Nifty50 ended 97 points lower at 11202.
Profit booking after the recent rally, US Fed meeting, a rise in COVID cases, as well as mixed earnings from India Inc. capped the upside in the previous session, suggest experts.Dr Reddy’s, IndusInd Bank, Nestle, Maruti, & Jubilant Lifesciences were some of the stocks that were in focus on Wednesday.
We have collated views of experts on what investors should do when the market resumes trading on Thursday, 30 July:Expert: Ashish Chaturmohta Head of Technicals and Derivatives, Sanctum Wealth Management
Looking at the long-term monthly chart, the stock has formed a rounding bottom pattern over the 5-year period. Thus, it has formed a major bottoming pattern.
The volumes on the up move have been high indicating buying participation in the stock. Now, for the last three months, the stock was trading in a sideways range of 4190-3614 and consolidating below its all-time high level of 4386.
Going forward, it (stock) has given a breakout from this range with long body candle and on high volumes. Thus, suggesting the stock is going to test its all-time high and even trend higher.If Dr. Reddy’s move above Rs 4390, the next target for the stock is 4750 and then 5000. On the downside, supports for the stock are seen at 4150 and then 3800 levels.
Since its March low of 235, the bounce-back has been facing resistance near 540-580 levels. Though the volumes have been high at lower levels indicating accumulation in the stock; it is yet to show a breakout on the upside with follow-through action.
Thus, if he stock crosses and sustains above the recent high of 577, the rally could head towards 640 and then 700 levels can be seen. On the downside, supports are seen at 528 and then 500 levels.
The stock was in a major downtrend from 1039 to 234 levels. Since March low, the stock has seen a strong bounce back with higher top and higher bottom formation on the daily chart to the current level of 771.
The momentum has been strong and volumes were also good which indicates a buying participation in the stock. The price has crossed key Fibonacci retracement of 61.8% which comes at 730 and trading above it.
Thus, data suggests that the stock is in an uptrend, not just a bear rally bounce back. Now, if the stock sustains above 730, it can continue its uptrend towards 850 and 900 levels. On the downside, supports are seen 730 and 650 levels.
The stock has been in an uptrend forming a higher top and higher bottom pattern since its March low of 4000. Volumes have also been high indicating accumulation at lower levels.
But, the up move has formed a bearish rising wedge pattern on the daily chart. Also, the key 61.8% Fibonacci retracement of the decline 7759-4001 comes at 6324 levels.
Thus, the stock needs to cross and sustain above 6324 for the uptrend to continue. If that happens, the stock could rally towards 6850-6950 levels.
On the downside, if it breaks below the recent swing low of 5750, then the decline can be seen towards 5300-5200 levels.
Since the stock hit an all-time high of 18370 in the month of April, the stock has been sideways for the last 3 months. On the downside, it has managed to hold 16000 levels and consolidating above it.
Post Q1 results, the stock has seen profit booking coming in and reversed from 17500 odd levels. In the short term, we expect the stock to continue to be rangebound between 17500-16000 levels.
A break below 16000, the decline could extend towards 14500 levels can be seen. On the upside, the stock first needs to cross and sustain above 17500 to test its all-time high of 18370. Above 18370, the next level is seen at 19400.
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