After a day of stellar performance, the market succumbed to selling pressure with the benchmark indices falling more than 1 percent due to weak global cues on September 1. Most of the key sectors, including private banks, financial services, FMCG, metal and IT stocks caught in bear trap.
The BSE Sensex plunged 770 points to 58,767 and the Nifty50 lost 216 points to 17,543, while the broader markets outperformed benchmark indices as the Nifty Midcap 100 and Smallcap 100 indices gained 0.1 percent each.
But the rising volatility made bulls uncomfortable at Dalal Street. India VIX, which measures the expected volatility in the market, rose by 6.27 percent to 19.87 levels.
Stocks that bucked the trend included ABB India which gained more than 4 percent to end at record closing high of Rs 3,404, continuing uptrend for fifth consecutive session and formed bullish candlestick pattern on the daily charts.
Gland Pharma jumped 5.6 percent to Rs 2,501 and formed small bodied bullish candle on the daily scale, while Schneider Electric Infrastructure climbed over 6 percent to Rs 145.3 and Inverted Hammer kind of pattern on the daily charts with above average volumes.
Here's what Shrikant Chouhan of Kotak Securities recommends investors should do with these stocks when the market resumes trading today:
After a short term correction, the stock took the support near Rs 2,300 and bounced back sharply. Post reversal, it not only cleared the short term resistance of Rs 2,450 but succeeded to close above the same which is broadly positive.
In addition, after long time, it closed above 50 days SMA (simple moving average - Rs 2,429). For the positional traders, Rs 2,429 would be the important support level and if the stock manages to trade above the same, the uptrend wave is likely to continue till Rs 2,650-2,700.
On the flip side, trading below 50 days SMA or Rs 2,425 uptrend would be vulnerable.
In this quarter so far, the stock rallied over 45 percent. On last Thursday, the stock hit a fresh all-time high of Rs 3,429.35. Technically, the stock holding uptrend continuation formation and on daily and weekly charts it has formed long bullish candle which is broadly positive.
However, due to temporary overbought conditions, traders may prefer to book profits at higher levels. For the trend following traders now, Rs 3,250 would be the key support zone. Above which the stock could move up to Rs 3,500-3,575.
On the flip side, below Rs 3,250, traders may prefer to exit from trading long positions.
Schneider Electric Infrastructure
On last Thursday, the stock rallied over 6 percent. Despite tepid market conditions the stock held the positive momentum and succeeded to close at day highest level.
In this quarter so far, the stock rallied over 45 percent. A promising higher bottom formation indicating further uptrend from the current levels. We are of the view of that the short term texture of the stock is still in to the positive side but due to temporary overbought situation we could see rangebound activity in the near future.
Hence, buying on dips and sell on rallies would be the ideal strategy for the short term traders. Rs 140 and Rs 135 would be the key support zone.
As long as the stock is trading above the same, the uptrend wave is likely to continue. Above which, it could move up to Rs 153-158. On the flip side, below Rs 140 it could slip till Rs 124-120.
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.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
