The recovery in last hour of trade helped the market curtail losses and closed with moderate losses on July 28, the first day of August series, continuing the downtrend for the second straight session after taking support around 19,600-19,500 levels on the Nifty50. One should be worried till the Nifty holds these levels in the coming sessions, experts said.
The index fell 14 points to close at 19,646, which is still above previous day's low, and formed a Doji kind of candlestick pattern on the daily charts, which is an indecisive pattern, while the BSE Sensex shed over 100 points to 66,160.
The selling pressure in Bank Nifty and Nifty IT weighed down the market. The Bank Nifty corrected over 200 points to 45,468, and the Nifty IT dropped more than 250 points to 29,490.
However, the broader markets performed better than the benchmark and sectoral indices as breadth tilted in favour of bulls. The Nifty Midcap 100 index was up over half a percent and the Smallcap 100 index gained 0.2 percent.
Stocks that outperformed the broader market included Prestige Estates Projects, Tata Power, and Tata Chemicals. Prestige Estates Projects shares climbed more than 8 percent to Rs 590 and formed a robust bullish candlestick pattern on the daily charts with strong volumes, after taking good support at 50-day EMA (exponential moving average - Rs 545).
Tata Power Company has also seen nice consolidation breakout by taking support at 50-day EMA (Rs 219). We have also seen a downward sloping resistance trendline breakout adjoining highs of November 9 last year and July 7 this year, and the stock has formed a robust bullish candlestick pattern on the daily scale with multi-fold jump in trading volumes over previous day. The stock jumped 6 percent to Rs 234.65.
Tata Chemicals has seen nearly eight-month closing high of Rs 1,051, up nearly 6 percent and formed strong bullish candlestick pattern on the daily timeframe with robust volumes after several months of consolidation breakout. Also, it has closed above all key moving averages.
Here's what Rajesh Palviya of Axis Securities recommends investors should do with these stocks when the market resumes trading today:
The stock is in strong uptrend across the time frames forming a series of higher tops and bottoms. Recently the stock has recaptured its 20 and 50-day SMA (simple moving average) and rebounded sharply indicating strong comeback of bulls.
On the weekly time frame, the stock has decisively broken out its three years "multiple resistance zone" of Rs 530 on a closing basis. This breakout is accompanied with huge volumes indicating increased participation. The daily weekly and monthly RSI (relative strength index) is in bullish mode which signals rising strength.
Investors should buy, hold and accumulate this stock with an expected upside of Rs 610-650, with downside support zone of Rs 550-530 levels.
With Friday's rally, the stock has decisively broken out its past one year "multiple resistance" at Rs 232 levels on a closing basis. This breakout is accompanied with huge volumes indicating increased participation.
The daily "Bollinger band" buy signal indicates increased momentum. The stock is well placed above its 20, 50, 100 and 200-day SMA which reconfirms bullish trend. The daily weekly and monthly RSI is in bullish mode which signals rising strength.
Investors should buy, hold and accumulate this stock with an expected upside of Rs 250-265, with downside support zone of Rs 230-220 levels.
On the daily chart, the stock has confirmed a "triangular" pattern breakout at Rs 1,025 levels along with huge volumes indicating bullish sentiments. This buying was observed around the 20, 50, 100 and 200-day SMA support zone which reconfirms bullish sentiments.
The daily and weekly "Bollinger band" buy signal indicates increased momentum. The daily weekly and monthly RSI is in bullish mode which signals rising strength.
Investors should buy, hold and accumulate this stock with an expected upside of Rs 1,100-1,180, with downside support zone of Rs 1,020-990 levels.
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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