The market showed smart recovery in the last couple of hours of trade, helping the benchmark indices continue uptrend for second straight session driven by banking and financial services, technology and pharma stocks on January 3.
The BSE Sensex climbed over 120 points to 61,294, while the Nifty50 rose 35 points to 18,232 and formed bullish candle on the daily charts with making higher high higher low formation.
The broader markets also extended northward journey as the Nifty Midcap 50, Nifty Midcap 100 and Smallcap 100 indices gained more than 0.2 percent each on positive breadth.
The volatility also cooled down further, giving comfort for bulls. India VIX, which measures the expected market volatility, fell by 2.04 percent to 14.39 level.
Stocks that were in action and performed better than broader markets included HDFC Life Insurance Company which was the biggest gainer in the Nifty50, rising 4.4 percent to Rs 595.60 and formed robust bullish candle on the daily charts with healthy volumes. In fact the stock has recouped all its December's losses seen in first two sessions of New Year 2023. The stock has seen a decisive breakout of long downward sloping resistance trend line adjoining June 3 and September 13, 2022, as well as horizontal resistance trend line adjoining several resistance points - February 14, February 21, June 13, November 25 and December 21, 2022, which all making the trend favourable for the stock.
Rail Vikas Nigam shares were locked in 5 percent upper circuit at Rs 71.95 and formed bullish candle on the daily charts with above average volumes, with making higher high higher low formation. Also there was a breakout of small downward sloping resistance trend line adjoining November 29 and December 21, 2022, as well as breakout of horizontal resistance trend line adjoining November 24, December 29 and December 30, 2022, indicating the positive mood.
Max Financial Services was also in action, rising nearly 4 percent to Rs 710 and there was formation of large bullish candle on the daily charts with above average volumes, with making higher high for third straight session. In fact, Tuesday's breakout was after couple of weeks of consolidation. The stock has seen a breakout of long downward sloping resistance trend line adjoining September 20, and December 19, 2022.
Here's what Vaishali Parekh of Prabhudas Lilladher recommends investors should do with these stocks when the market resumes trading today:
The stock has given a decent spurt in the last 4 months racing from Rs 31 level to touch the peak level of Rs 84 gaining almost 175 percent and after a short correction has taken support near the significant 50-day EMA (exponential moving average) level of Rs 60 and indicated a decent pullback to improve the bias.
We suggest to hold the stock with further positive move anticipated till the previous peak zone of Rs 84 level which is the resistance zone as of now and one can expect the target in the coming days in anticipation of any positive announcements in the Union Budget.
A decisive breach above Rs 84 zone can trigger for fresh further upward move with target of Rs 96 anticipated. The near term support or stop-loss can be kept near Rs 66 level.
The stock has witnessed a decent correction in the last 2-3 months slipping from Rs 850 zone and has bottomed out near Rs 625 level to witness a decent pullback to improve the bias.
Currently once again after a short dip recovered moving past the significantly 50-day EMA level of Rs 700 has shown a trend reversal with a positive bullish candle.
One can hold the position with immense upside potential visible with initial target of Rs 765 which is where the important 200 DMA (daily moving average) lies. The near term support can be kept at Rs 665 level with risk reward favourable with probability of upside movement much higher.
The stock has indicated a big bullish candle on the daily chart with decent volume participation and has given a trendline breakout near Rs 590 level with improvement in the trend.
Further rise is anticipated with next targets of Rs 645-680 and Rs 740 level with also the indicators showing positive bias supporting our view. One can hold the stock with near term support zone maintained near Rs 565 level.
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