The market nosedived with the benchmark indices falling more than one percent as bulls failed to sustain their strong hold over Dalal Street on October 3. The selling across sectors, barring pharma, pulled the market down.
The BSE Sensex declined more than 600 points to 56,789, and the Nifty50 tanked over 200 points to 16,887, forming bearish candle on the daily charts, while the Nifty Midcap 100 and Smallcap 100 indices were also under pressure, falling 1.25 percent and 0.66 percent respectively.
The volatility index India VIX also spiked 7 percent to 21.37 levels, making the bears more strong.
Stocks that were in action and performed far better than broader markets included Chalet Hotels which gained nearly 4 percent to Rs 367, forming strong bullish candle on the daily charts with robust volumes. The stock continued higher high formation for fifth consecutive session.
Cochin Shipyard surged 10 percent to Rs 485.40, the highest closing level since June 4, 2018 and formed robust bullish candle on the daily charts with significantly higher volumes, while VIP Industries was also in focus, rising more than 7 percent to Rs 714.65 and has seen bullish candlestick pattern formation with above average volumes.
Here's what Vidnyan Sawant of GEPL Capital recommends investors should do with these stocks when the market resumes trading today:
On the weekly charts of Cochin Shipyard, we can spot that the prices have broken the prior swing high of Rs 433.90 (June 2021), which initiate the prices to form Higher High, Higher Low formation.
Prices on the daily timeframe are continuously hovering around the upper Bollinger band pointing towards the rising volatility of the prices on the upside.
The stock is currently trading above all its key averages i.e. 50, 100, 200 days EMA (exponential moving average), confirms the uptrend.
We advise traders and investors to hold this stock with the stop-loss of Rs 390 on the closing basis for the target of Rs 590 levels.
Correction of VIP since October 2021 was orderly, price did not get into the Lower High, Lower Low to what the benchmark Index Nifty have done. This shows the strong outperformance of the stock and a relative strength.
Prices in the latest trading session have given a breakout from the Bullish Flag pattern (Bullish Continuation pattern), indicating beginning of the trend to the upside.
The breakout is confirmed as it is accompanied by a Gap and higher volumes.
The stock is currently trading above its key moving averages i.e. 50 & 200 days EMA, which have acted as a variable support for the prices.
RSI (relative strength index) on the daily timeframe have shown a bounce on the upside while protecting 50 level, this reflects the strong momentum behind the prices.
We recommend traders and investors to buy and accumulate this stock for the target of Rs 875 with the stop-loss of Rs 634 on the closing basis.
Chalet is currently trading at record high levels which already shows that the stock is in strong momentum.
In the latest trading session prices have given a breakout from rounding bottom pattern while taking support from the Bullish trend line which the prices have respected since January 2022.
Prices have shown a bounce from the 50 Day EMA which have acted as a brilliant support for the prises and a proxy for the above trend line too.
RSI on the Daily as well as on weekly timeframe have sustained above the 50 mark which again confirms that he stock has strong momentum.
Going ahead we expect the prices to go higher till the level of Rs 400 where the stop-loss must be Rs 340 on the closing basis.
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