It was yet another weak session for the market as participants maintained caution on Tuesday ahead of the major global event of the Federal Reserve policy meeting.
The BSE Sensex fell nearly 500 points to 55,268 and the Nifty50 closed below 200 days exponential moving average (16,520), falling nearly 150 points to 16,484.
All sectors witnessed selling pressure. Nifty IT was the biggest loser, down nearly 3 percent, followed by Auto, FMCG, Pharma and Realty indices which fell more than 1 percent each.
The broader markets also joined bears' party as the Nifty Midcap 100 and Smallcap 100 indices were down 1.25 percent and 1.5 percent respectively on weak breadth. About three shares declined for every advancing share on the NSE.
The volatility index India VIX increased further, up 2.77 percent at 18.17 levels, making the trend more favourable for bears.
Stocks that were in action and bucked the trend included Bajaj Finserv, Sun TV Network and Delta Corp which were among the top five gainers in the futures and options segment.
Bajaj Finserv rallied 5.5 percent to Rs 13,313, the highest closing level since May 11, and formed bullish candle on the daily charts with significant volumes, trading in the upper band of Bollinger Band by taking support at 5 DEMA since last week.
Sun TV Network climbed 5.2 percent to Rs 465.80, the highest closing level since May 2, with robust bullish candlestick pattern on the daily charts with large volumes despite weakness in the equity market. With Tuesday's big candle, there was an expansion of Bollinger Band in the upper band.
Delta Corp gained 4.6 percent at Rs 193, continuing uptrend for second consecutive session with bullish candlestick pattern formation and more than above average volumes.
Here's what Ruchit Jain of 5paisa recommends investors should do with these stocks when the market resumes trading today:
Along with the broader markets, the stock has seen a sharp price wise correction since the month of October 2021. However, during this month, prices have seen a pullback move from the swing lows of Rs 10,727 and now the price momentum is gaining momentum with rising volumes.
The ‘RSI’ (relative strength index) oscillator is also hinting at a positive momentum and hence, we could see further pullback move in the stock in the near term. The previous support of Rs 13,800 which was broken in the month of May will be the first level to watch as previous support could usually act as resistance on pullback.
If the price manages to surpass the same, then it could continue its momentum towards Rs 14,100 and Rs 14,900 which are retracement levels of the previous correction. On the flipside, the '20 DEMA' around Rs 12,250 will now be seen as a crucial support on any declines.
Post consolidating in a range in last couple of months, the stock witnessed a buying interest and has given a breakout from that consolidation. The volumes along with the breakout were high which is a positive sign.
The momentum readings are also hinting at a positive momentum and hence, we could see further upmoves in the near term. Hence, traders should look to trade with a positive bias and look to buy on declines around the support range of Rs 450-440.
Price could test the trendline resistance which is seen around Rs 490. Above which, it could then result into a larger degree breakout.
The stock has recently seen an underperformance as prices have corrected sharply from its high of Rs 340 to Rs 162. Prices have now seen some pullback move from this swing low but are yet to witness any impulsive up move.
Hence, one should read this as just a pullback move which would retrace the recent correction. The 23.6 percent retracement of this correction is placed around Rs 204 while 38.2 percent retracement is seen around Rs 230. The immediate support for the stock is around Rs 175.
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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