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Trade Spotlight: What should investors do with NOCIL, Welspun India & Zensar Technologies?

On July 27, NOCIL rose nearly 3 percent to hit a fresh 52-week high, Welspun India gained over 7 percent and Zensar Technologies closed 3 percent higher

July 28, 2021 / 07:22 AM IST
 
 
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Indian market failed to hold on to the momentum amid weak global cues and selloff in the pharma pack on July 27. The Nifty closed below 15,800, while the Sensex was down nearly 300 points.

Sectorally, selling pressure was seen in pharma, energy, private bank, realty and infrastructure, while metal and PSU banks saw buying interest.

Stocks that were in focus included NOCIL, which rose nearly 3 percent to hit a fresh 52-week high, Welspun India gained more than 7 percent, and Zensar Technologies closed with gains of more than 3 percent. All these stocks also hit a fresh 52-week high.

Here's what Mazhar Mohammad, Chief Strategist–Technical Research & Trading Advisory, Chartviewindia.in, recommends investors should do with these stocks when the market resumes trading today:

Welspun India: Buy with a stop below Rs 125

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This counter seems to have registered a breakout above its three-month-old ascending channel on July 19, 2021 with decent volumes.

Since then, the stock has been consolidating in a narrow band of 134 to 123 and is taking support on the erstwhile upper boundary of the said channel.

A close above 134 shall signal resumption of up move for a channel breakout target of 149. For the time, fresh buying is also advised, with a stop below 125 on a closing basis for a target of 149.

NOCIL: Fresh buying is advised around 250

Though it is trading at new lifetime highs, which is positive, but in the near term, it may come under selling pressure as hinted by the price action of the last session in which it registered a Shooting Star formation with a long upper shadow.

Moreover, on the weekly charts, it appears to be struggling around the upper boundary of its 25-week-old ascending channel for the last three weeks.

Therefore, it is in need of a fresh breakout above 278, which will open up much bigger targets towards 330. If it slips below 265, it can extend the weakness towards 248. As long as it holds the support of 248, it can remain a buy-on-dip opportunity.

Therefore, positional traders who managed to enter at much lower levels can hold by placing a stop below 248 on a closing basis r exit in the next session on the failure to sustain above 265.

Fresh buying is advised around 250, with a stop below 248 on a closing basis for a target of 290.

Zensar Technologies: Book Profits

This counter appears to have cultivated the habit of undergoing multi-week consolidation after a brief rally at regular intervals. Since the current leg of the rally is six-week old, a corrective downswing can’t be ruled out.

Moreover, selling pressure seen in the last session at higher levels resulted in a Shooting Star formation with a long upper shadow.

If it trades below 395 in the next session on a closing basis, it may set the tone for a corrective downswing with an initial target of 360. Therefore, traders are advised to book profits for the time being.

Disclaimer: The views and investment tips expressed by 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.

 
Kshitij Anand is the Editor Markets at Moneycontrol.

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