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Trade Spotlight | What should you do with Hikal, KRBL, Zomato on Wednesday?

Hikal rallied 6 percent to Rs 361, the highest closing level since May 27 and formed bullish candle on the daily charts with above average volumes. It has seen a breakout of long down ward sloping resistance trend line adjoining April 8 and September 9.

September 14, 2022 / 06:33 AM IST
 
 
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It was yet another positive day for the market as the Nifty50 reclaimed its psychological milestone of 18,000 mark on September 13, backed by uptrend in global counterparts ahead of US inflation. Banking and financial services, FMCG and metal stocks aided the rally on Tuesday.

The BSE Sensex gained little more than 450 points to 60,571, and the Nifty50 rose more than 130 points to 18,070, the highest level since January 18, while the Nifty Midcap 100 and Smallcap 100 indices advanced 0.16 percent each.

Stocks that were in action included Hikal which rallied 6 percent to Rs 361, the highest closing level since May 27 and formed bullish candle on the daily charts with above average volumes. It has seen a breakout of long down ward sloping resistance trend line adjoining April 8 and September 9.

KRBL jumped nearly 14 percent to Rs 365, the highest closing level since March 13, 2019 and formed robust bullish candlestick pattern on the daily charts with large volumes, while Zomato was up 4.6 percent at Rs 64.5 and formed a bullish candle on the daily scale with above-average volumes.

Here's what Ruchit Jain of 5paisa.com recommends investors should do with these stocks when the market resumes trading today:

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Hikal

The stock has corrected sharply along with the broader markets in the first half of this calendar year. However, prices have recently seen an up-move, supported by good volumes which indicates buying interest in the counter. The stock is riding above its '20 DEMA' (days exponential moving average) and has also surpassed the ‘200 DEMA’ hurdle.

However, the momentum readings have now reached the overbought zone after the recent rally. So, although the up move could continue in the near term, the risk-reward ratio is not favourable for fresh investment and hence, we advise only existing shareholders to continue to ride the bandwagon.

The '20 DEMA' support is now placed around Rs 326 which is now seen as the short term support. On the flipside, the immediate resistance will be seen around Rs 395 followed by Rs 412 which is the retracement resistance.

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KRBL

The stock has seen a sharp rally in last few days where prices have formed a ‘Higher Top Higher Bottom’ structure. The upmove has also been supported by higher volumes which is a positive sign while the RSI oscillator continues to hint at a positive momentum.

However, prices are trading around its important resistance of 50 percent retracement level of the previous corrective phase. A sustained move above Rs 370 will provide support for a continuation of the rally towards the next retracement levels of Rs 365.

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Zomato

Since the month of November 2021, prices had seen a sharp correction form the high of Rs 169 and had even breached Rs 45 in July 2022. In last one and a half month, prices have seen a pullback move from the lows and also have witnessed surge in volumes indicating buying interest at lower levels.

However, from a short term perspective, the prices have been forming a ‘Cup and Handle’ pattern on the daily chart and the breakout from the pattern is seen above Rs 68.

Hence, a breakout above this hurdle could then lead to some positive momentum in the stock towards its next resistances of Rs 73 and Rs 80. The immediate support for the stock is placed around the swing low of Rs 57.

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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.
Sunil Shankar Matkar
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