The market ended exactly on the downward sloping resistance trendline, which comes in between 19,450-19,500 levels, with continuing higher highs formation for third consecutive session on August 23. Hence, the closing and sustaining above 19,500 in coming sessions can help the Nifty50 gain momentum for further upmove, but failure of the same can bring the index down towards support levels of 19,300-19,250 again, experts said.
The Nifty50 climbed 48 points to 19,444, and the BSE Sensex rose 213 points to 65,433, continuing uptrend for third consecutive session, while the Nifty Midcap 100 and Smallcap 100 indices extended uptrend, rising 0.4 percent and 0.9 percent respectively.
Bank Nifty clocked strong performance after consolidation for several session in the past, climbing 486 points to 44,479, while the Nifty IT was up 22 points at 30,924.
Stocks that reported healthy performance included Sun TV Network, Suzlon Energy, and Quess Corp. Sun TV Network jumped nearly 5 percent to Rs 568, the highest closing level since November 10, 2021, and formed robust bullish candlestick pattern on the daily charts, with multi-fold jump in volumes. The stock has seen a decisive breakout of downward sloping resistance trendline adjoining highs of November 10, 2022 and August 17, 2023, which is a positive sign.
Suzlon Energy has formed long & healthy bullish candlestick pattern on the daily scale for second consecutive session, with above average volumes and sustained above all key moving averages. The stock jumped 4.8 percent to Rs 21.85, the highest closing level since November 2, 2015.
Quess Corp rose 4.7 percent to Rs 420.80 and formed long bullish candlestick pattern on the daily timeframe with above average volumes, continuing uptrend for second straight session, after consistent downtrend in previous 10 days in a row.
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:
Though the said counter looks lucrative due to the recent rallies, one needs to be cautious since it is about to complete a bearish Alternate Bat pattern (i.e., The pattern incorporates the 1.13XA retracement, as the defining element in the potential reversal zone (PRZ)).
The B-point retracement must be a 0.382 retracement or less of the XA leg. The Alternate Bat pattern utilizes a minimum 2.0BC projection.
Additionally, the daily RSI (relative strength index) is not making higher highs along with price action thus suggesting possible negative divergence. If already bought, then book profits in the range of Rs 575-590. Fresh longs are not advised as of now.
At the current juncture, Suzlon has made a bearish divergence on a daily scale, where RSI is making lower highs and price action making higher highs. Additionally, it is trading near Rs 22 mark which is way above its all-major daily exponential moving averages (i.e. 50-100-200 days).
Going forward there is a possibility of reversion to mean. One should book profits in the range of Rs 22-23, if already holding. Fresh longs are not advised as of now.
On August 22, 2023, the said counter had made a Bullish Harami pattern exactly near 50 retracement of its previous up-move. Having said that during this pattern formation, the daily RSI has formed a hidden bullish divergence (price retracing till 50 percent but RSI daily got oversold) which hints towards further bullish bias in the counter.
In the previous trading session, Quess Corp reversed from a 50 percent retracement and closed with a handsome gain of 4.7 percent. One can buy in the range of Rs 415-425 with an upside target of Rs 475 and a stop-loss of Rs 393 on a daily closing basis.
Disclaimer: The views and investment tips expressed by experts on Moneycontrol are their own and not those of the website or its management. Moneycontrol advises users to check with certified experts before taking any investment decisions.
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