The market broadly continued with its higher-high, higher-low formations on the daily charts, indicating the possibility of another leg of rally towards the 22,500 mark in the coming sessions. But for that, it needs to break the consolidation range of 21,950 to 22,300 on the higher side. The immediate support for the Nifty 50 is seen at 22,000 and crucial support at 21,950, which coincides with the 21-day exponential moving average (EMA), experts said.
On February 27, the market snapped a two-day losing streak with the Nifty 50 gaining 76 points to 22,198 and forming a bullish candlestick pattern, which resembles the bullish engulfing kind of a pattern on the daily charts.
The BSE Sensex gained more than 300 points to 73,095, while the broader markets had a mixed trend with the Nifty Midcap 100 index down 0.1 percent and Smallcap 100 index down 0.3 percent.
Stocks that recorded better gains than the benchmark indices included ICICI Lombard General Insurance Company, Tata Motors, and NCC. ICICI Lombard General Insurance Company ended at a record closing high of Rs 1,727, up 4.6 percent and formed strong bullish candlestick pattern on the daily charts after several days of consolidation, with significantly higher volumes. The stock traded above all key moving averages, which is a positive sign.
Tata Motors also saw all-time closing high of Rs 963, up 2.75 percent and formed long bullish candlestick pattern on the daily timeframe after a decisive breakout of horizontal resistance trendline adjoining highs of February 5 and February 16, with above average volumes. This stock, too, traded above all key moving averages.
NCC rose 2.6 percent to end at new closing high of Rs 260 and traded well above all key moving averages. The stock has formed bullish candlestick pattern with upper and lower shadows on the daily scale with above average volumes, while overall volumes in the current year were on the higher side.
Here's what Riyank Arora of Mehta Equities recommends investors should do with these stocks when the market resumes trading today:
The stock has experienced a strong breakout above its recent swing high of Rs 950 on daily charts. A strong bullish candle, with volumes almost equivalent to the average of the last 30 days, indicates the possibility of a significant upward move.
The stock is also observed to be breaking out of an ascending triangle pattern formation. The upside potential target, as per the pattern, suggests that the stock is likely to head towards Rs 1,000 and Rs 1,005 levels, with a stop-loss at Rs 930 level.
ICICI Lombard General Insurance
The stock has broken out above its September 2021 highs, forming a strong bullish candlestick towards the closing. A sharp rise in volumes was observed, with intraday volumes being almost 4 times the average of the last 30 days.
Going forward, any pullback towards Rs 1,700 would be a good buying opportunity on the stock, with a stop-loss below Rs 1,650 for upside potential targets of Rs 1,825 and Rs 1,850.
The stock has experienced a significant breakout above its January 2008 highs, signaling strong momentum and a 16-year price breakout. Volume in Tuesday's session was observed to be almost 1.5 times the average of the last 30 days, and the stock has been moving in a consistent uptrend rally for the last few weeks.
Any pullback towards Rs 248-252 would be a good buying opportunity on NCC, with a stop-loss below Rs 225 mark; for upside potential targets of Rs 280 and Rs 300.
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