The market maintained uptrend for three days in a row with the Nifty50 closing near recent swing high (18,778) on June 14, driven by buying interest in select metal, oil & gas, FMCG, and auto stocks. If the index surpasses this swing high then there could be further resistance placed at record high levels.
The BSE Sensex rose 85 points to 63,229, and the Nifty50 advanced by 40 points to 18,756, while the Nifty Midcap 100 and Smallcap 100 indices also sustained upward rally for third straight session, up 0.2 percent and 0.1 percent respectively.
Bank Nifty traded in opposite direction amid consolidation and closed with 92 points at 43,988, while the volatility remained rangebound at lower levels, indicating stable conditions in the market.
Stocks which were in action on Wednesday included KEI Industries, Tanla Platforms, and APL Apollo Tubes. KEI Industries ended at record closing high of Rs 2,205.7, up nearly 5 percent after a decisive breakout of previous four-day consolidation, with healthy volumes. The index has formed long bullish candlestick pattern on the daily charts.
After horizontal resistance trendline breakout in previous session, Tanla Platforms has extended upward rally with closing 3.7 percent higher at Rs 999, though there was profit taking at higher levels. The stock has formed bullish candlestick pattern with long upper shadow on the daily scale; with significantly higher volumes for yet another session, with maintaining higher highs, higher lows since March lows.
APL Apollo Tubes has been in an uptrend for sixth consecutive session, rising more than 4 percent to Rs 1,349 on Wednesday and formed long bullish candlestick pattern with no upper shadow and very small lower shadow on the daily charts. The stock has maintained higher highs, higher lows formation for five days in a row, with good volumes.
Here's what Jigar S Patel of Anand Rathi Shares & Stock Brokers recommends investors should do with these stocks when the market resumes trading today:
Since the last 2 months, the said counter has already given 116 percent from the low of Rs 493 and currently trading near Rs 1,050 levels. Though it looks lucrative due to recent up-moves, one needs to be cautious since it is approaching its historical resistance near Rs 1,050-1,070 levels.
On the indicator front, daily stochastics are displaying some negative-regular divergence which hints towards some pullback in a few sessions. As of now, no fresh longs are recommended. If already bought, then book profits in the zone of Rs 1,050-1,070 levels.
Though APL Apollo Tubes might be looking lucrative due to recent up moves in the counter. One needs to see that it is trading way above 200 DEMA (day exponential moving average) which comes around Rs 1,131 (daily exponential moving average) so mean reversion could be possible if it gets rejected from top due to overbought daily Stochastics.
One can book profit in the zone of Rs 1,340-1,360 levels. As of now no fresh longs are recommended.
At the current juncture, the said counter is trading at all-time high. On daily scale, Stochastics has made negative regular divergence (refer to the chart) where price action is making higher highs and stochastics is making lower highs which is hinting towards possible pullback in coming few sessions.
Additionally, 200-DMA stands around Rs 1,664 levels which is far below the current market price, so mean reversion could be possible.
One should immediately book profits in the zone of Rs 2,200-2,300 levels. As of now no fresh longs are recommended.
Disclaimer: The views and investment tips expressed by investment 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.
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