The market has seen correction for the first time after five straight sessions in the green, may be due to some profit-taking after nearly a 500-point rally on the Nifty50 on November 2, on the back of mixed global cues.
The BSE Sensex fell more than 200 points to 60,906, while the Nifty50 declined over 60 points to 18,083 and formed Bearish Belt Hold kind of pattern on the daily charts.
The broader markets closed flat with a negative bias, performing better than benchmarks. The Nifty Midcap and Smallcap 100 indices declined 0.08 percent and 0.12 percent respectively amid muted breadth.
Stocks that were in action and bucked trend included Sharda Cropchem which was the third biggest gainer in the Nifty500 index, climbing more than 7 percent to Rs 400. The stock has formed bullish candle with significantly higher volumes and if we look at the last three days performance, then there was Morning Star kind of pattern, which is a bullish reversal pattern.
Alembic Pharmaceuticals shares rallied nearly 6 percent to Rs 612, forming large bullish candlestick pattern on the daily charts for second consecutive session with above average volumes after consolidation for past more than a week period.
Redington was also in focus in the falling market, rising nearly 8 percent to Rs 148. The stock has formed robust bullish candle on the daily charts with large volumes after rangebound trade for more than a month.
Here's what Jigar S Patel of Anand Rathi Shares & Stock Brokers recommends investors should do with these stocks when the market resumes trading today:
The free fall started from July 2022 till October 2022 which resulted in a 47 percent decline in price. On a daily scale, the counter has formed classic Doji near its historical support of Rs 375 along with drying volume which indicates that bears are losing grip.
In the previous trading session, the said counter witnessed nice buying interest support by good volume which is adding more confirmation for early reversal in the counter.
On the indicator front, the daily RSI (relative strength index) has formed a bullish divergence near the oversold zone (refer to the chart) which further confirms the upside in the counter.
One can buy in small tranches at current levels and buy another tranche at around Rs 390 levels (if tested). The upside is expected till Rs 480 and support is seen around Rs 365.
On monthly scale after hitting all-time high of Rs 1,111, the counter nosedived till Rs 540 levels which accounted to 51 percent depreciation in price.
Even on daily scale negative volume is drying up indicating for possible upside momentum. On indicator front, monthly RSI has formed impulsive structure near oversold zone which further confirms upside in counter.
One can buy at current levels, upside is expected till Rs 680 and credible support is seen at Rs 575.
Since last one month the counter has been trading in a tight range of Rs 135-142 levels. In previous trading session, it gave clean breakout from said range with heavy volume, also Rs 136 levels is 200 DEMA (days exponential moving average) acting as massive support.
On indicator front, daily RSI has bounced from 40 levels along daily rate of change is placed at 6.98 adding further confirmation for upside.
One can buy at current levels in small tranche and another at Rs 143 with upside expected till Rs 165 with credible support at Rs 135.
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