Bears turned out to be in a strong position after a long time, pulling the benchmarks down to near two-month low on December 23. Surging Covid cases in several nations and weak global cues amid growing recession fears made market participants cautious.
The BSE Sensex tanked nearly 1,000 points to 59,845, while the Nifty cracked more than 300 points to 17,807, and formed long bearish candle on the daily charts. On the weekly scale also, there was bearish candle formation, while on monthly time frame we have bearish engulfing candle pattern formation, which indicates the possibility of more weakness going ahead.
The broader markets also faced severe selling pressure, with the Nifty Midcap 100 and Smallcap 100 indices declining 3.8 percent and 4.7 percent, respectively.
India VIX, the fear index, increased by 6.4 percent to 16.16 levels, up from 15.19 levels, making the situation uncomfortable for bulls.
Stocks that bucked the trend included Shilpa Medicare, which was the biggest gainer in the Nifty500 index, rising 8 percent to Rs 289.55 and formed a bullish engulfing candle on the daily charts after a three-day sell off. The stock has seen break out of small downward sloping resistance trend lines adjoining December 1 and December 14, as well as December 6 and December 21.
Suven Pharmaceuticals and Thyrocare Technologies, too, were amongst the top five gainers in the Nifty500 index. Suven Pharmaceuticals shares gained 2.6 percent at Rs 496 and formed bullish candle on the daily charts with significantly higher volumes, making higher highs higher lows for a third straight day.
Thyrocare Technologies rose nearly 2 percent to Rs 635 and formed bullish candle on the daily charts with long upper shadow, which resembles bullish Harami kind of pattern formation, which is bullish reversal pattern. The trading volume was high on the same day.
Here's what Rajesh Palviya of Axis Securities recommends investors should do with these stocks when the market resumes trading today:
The stock is in a strong down trend. However, with Friday's eight percent gains the stock has rebounded sharply. This buying momentum was accompanied with huge volumes indicating increased participation at lower levels.
On the daily chart, the stock has confirmed an "Engulfing Pattern" reversal pattern. However, any follow up close above Rs 300 levels may confirm this pattern. The positive divergence on the daily RSI signals rising strength at lower levels.
The daily and weekly strength indicator RSI (relative strength index) remains in positive terrain, which supports upside momentum.
Investors should buy, hold and accumulate this stock with an expected upside of Rs 320-335, with downside support zone of Rs 260 levels.
Since July 2022, the stock continues to consolidate within Rs 770-600 levels representing early signs of accumulation and reversal. The huge volume spike in consolidation zone signals increased participation near the support zone.
A decisive close above Rs 740- 750 levels may result in "consolidation breakout". The daily and weekly strength indicator RSI signals rising strength at lower levels.
Investors should buy, hold and accumulate this stock with an expected upside of Rs 830-850 with downside support zone of Rs 600-590 levels.
On the daily and weekly timeframe, the stock is trending up forming a series of higher tops and bottoms representing bullish sentiments. It has also placed above its 20, 50, 100 and 200-day SMA (simple moving average) which reconfirm bullish sentiments.
On the weekly timeframe, the stock has decisively broken out its "multi-week resistance zone" at Rs 490 levels which signals strong comeback of bulls. This breakout is accompanied with huge volumes indicating increased participation.
The daily and weekly strength indicator RSI signals rising strength at breakout zone.
Investors should buy, hold and accumulate this stock with an expected upside of Rs 540-560, with downside support zone of Rs 480-450 levels.
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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