The market staged a rebounded after significant correction from record highs, but its sustainability will be tested in coming sessions. If Nifty 50 corrects, it may try to take support at 21,900, the low of last big bearish candle (May 9), also coinciding with a rising support trendline. However in case of further recovery, it may face hurdle at 22,200-22,300 levels, experts said.
On May 10, the Nifty 50 traded within the previous day's range, and jumped 98 points to close at 22,055, forming bullish candlestick pattern with minor upper & lower shadows on the daily charts, while the BSE Sensex rose 260 points to 72,664.
The broader markets also gained strength with the Nifty Midcap 100 and Smallcap 100 indices 0.9 percent and 0.7 percent respectively. Moneycontrol selected three stocks - Muthoot Finance, UPL, and Hero MotoCorp which outperformed broader markets on May 10. Muthoot Finance showed smart recovery after recent downtrend and climbed to the middle of Bollinger band. The stock rallied 4 percent to Rs 1,663 with average volumes and traded above all key moving averages.
UPL jumped 7.6 percent to Rs 502 and climbed above the middle of Bollinger band in a single session. The stock formed strong bullish candlestick pattern on daily charts with healthy volumes and traded above all short-term moving averages.
Hero MotoCorp reached the new top during the day and settled the session at Rs 4,877, up 2.4 percent. The stock has formed bullish candlestick pattern with healthy volumes for third consecutive session, trading above all key moving averages, which is a positive sign.
Here's what Rajesh Palviya of Axis Securities recommends investors should do with these stocks when the market resumes trading on May 13:
The stock is in strong uptrend across all the time frames forming a series of higher tops and bottoms indicating positive bias. On the weekly chart, the stock has exactly rebounded from its prior breakout zone of Rs 1,530 levels which shows a strong comeback of bulls.
On the monthly time frame, the stock has confirmed a "rounding bottom" formation on a closing basis. Past three months rising volumes signifies increased participation near all time high.
The stock has been well placed above its 20, 50, 100 and 200-day SMA (simple moving average) and these averages are also inching up along with price rise which reaffirms the bullish trend.
Investors should buy, hold and accumulate this stock with an expected upside of Rs 1,750-1,950 with downside support zone of Rs 1,600-1,500 levels.
Since June 2021, the stock was trending lower forming a series of lower tops and bottoms formation. However, since the past four months the stock is consolidating within Rs 515-447 levels along with huge rising volumes. It indicates accumulation buying interest at lower levels.
The positive crossover of 20 and 50-day SMA signifies short term trend reversal. Any sustainable move above Rs 515 levels, can cause "consolidation range " breakout which may lead upside towards Rs 550-570 levels. The daily, and weekly strength indicator RSI (relative strength index) is in positive terrain which justify rising strength on short to medium term time frames.
Investors should buy, hold and accumulate this stock with an expected upside of Rs 550-580, with downside support zone of Rs 480-460 levels.
The stock is in strong uptrend across all the time frames forming a series of higher tops and bottoms indicating positive bias. On the weekly chart, the stock has confirmed a "Flag" formation - a continuation pattern breakout indicating resumption of the prior uptrend. Huge rising volumes indicate increased participation.
The stock is well placed above its 20, 50, 100 and 200-day SMA and these averages are also inching up along with price rise which reconfirms bullish trend. The daily and weekly strength indicator RSI is in positive terrain which signals rising strength.
The daily, weekly and monthly strength indicator RSI is in positive terrain which justify rising strength across all the time frames.
Investors should buy, hold and accumulate this stock with an expected upside of Rs 5,085-5,280, with downside support zone of Rs 4,750-4,600 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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