The market showed smart recovery from day's low in afternoon and ended almost flat with negative bias on July 11, weighed down IT stocks as well as weak global cues. However, the buying in banking and financial services, auto, metal, pharma, and select FMCG stocks cut down losses.
The BSE Sensex fell 87 points to 54,395, and the Nifty50 declined 5 points to 16,216 but formed bullish candlestick pattern on the daily charts as the closing was higher than opening levels.
The broader space has seen an outperformance on Monday as the Nifty Midcap 100 and Smallcap 100 indices gained nearly 1 percent each on positive breadth.
The declining volatility also supported the market sentiment. India VIX, the fear index fell by 0.14 percent to 18.37 levels.
Stocks that were in action and outperformed broader space included Granules India which rallied more than 6 percent to Rs 297, forming robust bullish candlestick pattern on the daily charts with above average volumes on Monday, and higher high higher low formation for third straight session. It was also the biggest gainer in the futures & options segment.
Adani Total Gas shares jumped 7 percent to Rs 2,717 and strong bullish candle on the daily charts with above average volumes on Monday and higher high higher low formation for fifth consecutive session, while Bank of Baroda climbed 3.7 percent to Rs 109.55 and formed bullish candle on the daily charts with above average volumes on Monday and higher high higher low formation for fourth consecutive session.
Here's what Vidnyan Sawant of GEPL Capital recommends investors should do with these stocks when the market resumes trading today:
On daily time frame of Bank of Baroda, we witnessed that prices has been moving up in a strong upward slopping channel since December 2020 and recently on June 20, 2022 it showed a bounce on the upside from the channel support.
Around the channel support, we can spot that in the recent trading session, prices have given a breakout from Double Bottom pattern, which is a bullish reversal pattern. The breakout is followed by high volumes, which indicates that breakout is carried with higher participation.
On daily time frame, prices have closed above upper Bollinger band which is expanding, suggesting an increase in the volatility on the positive side.
Relative strength index (RSI) plotted on daily time frame is rising and above 50 mark, which tells that the stock has a stronger momentum.
Going ahead the stock has potential to move higher towards Rs 120 levels. We recommend traders and investors to buy Bank of Baroda with a stop-loss of Rs 100.5, strictly on the closing basis.
Adani Total Gas on July 8, 2022 gave a breakout of down trending channel which it took 60 trading sessions to form. Prior to breakout, prices showed a bounce back from the trend line on June 20, 2022. The trend line which was respected since July 22, 2021.
In the latest trading session (i.e. the candle followed by breakout candle) we saw a move on the upside which was followed by higher volumes, indicating an impulsive move in the direction of the breakout.
On July 5, 2022 we saw a positive crossover by the 12 EMA and 26 EMA (exponential moving average), suggesting a continuation of prior uptrend.
The stock can move higher further till the level of Rs 3,300. We recommend the trader and investor to buy this stock with a stop-loss of Rs 2,360, strictly on the closing basis.
On the daily chart, we witnessed prices of Granules moving in a clear down trending channel since December 2020. Prices in the latest trading session have given a breakout of Double Bottom pattern around the channel support, where the breakout is carried with a strong volume. The Double Bottom pattern is a bullish reversal pattern.
We witnessed positive divergence between the prices and RSI indicator. The divergence is followed by breakout in RSI as well which indicates a strong momentum in the stock prices.
Traders and investors can continue holding the stock and expect an upside movement towards 320 levels with a stop-loss of Rs 278, strictly on the closing basis.
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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