Indian market marked yet another milestone on August 18 with the Nifty crossing 16,700 and Sensex scaling 56,000 but profit-taking towards the close of the trade pushed the indices in the red. The market will remain shut on August 19 for Muharram.
On August 18, the Nifty metal and bank indices fell 0.8 percent each, while buying was seen in the FMCG, pharma, and PSU Bank names.
Dr Lal Pathlabs, which rose 4 percent, and MindTree that gained nearly 6 percent, remained in focus, hitting a fresh 52-week high.
Here's what Shrikant Chouhan, Executive Vice President, Equity Technical Research at Kotak Securities Ltd, recommends investors should do with these stocks when the market resumes trading on August 20:
The stock registered an all-time high of Rs 3,243, and has rallied nearly 15 percent in August. After a strong opening on August 18, the stock was rallied from Rs 3,019 to 3,220.
After a strong gap-up opening, it maintained positive momentum throughout the day. On the daily and weekly charts, the stock has formed a breakout continuation pattern, which is positive.
However, intraday chart texture indicates a temporary overbought situation and traders may prefer to take cautious stance near Rs 3,300-3,350.
As long as the stock is trading above Rs 3,140, the uptrend texture is likely to continue up to Rs 3,300-3,350. On the flip side, dismissal of Rs 3,140 can possibly trigger quick short-term correction up to Rs 31,00-3,050.
After a strong uptrend, the stock is hovering in the 3,740-3,928 range. On August 18, the stock opened with a gap up and swiftly cleared the short-term resistance near 3,930, which was broadly positive.
On the daily chart, the stock has formed a strong reversal formation along with incremental volume activity that suggests a further uptrend.
For positional traders, Rs 3,850, or the 10-day SMA, would be the key level to watch out. As long as it trades above the same, the uptrend texture is likely to continue up to Rs 4,150-4,225.
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