Overall, the sentiment largely remained in favour of bears given the long bearish candlestick pattern formation on the daily charts, breaking down of the lower end of the rising channel and bearishness in momentum indicator RSI (relative strength index at 38 level), though there is some possibility of rebound due to consistent selling pressure since record high levels. If the Nifty manages to rebound, it may face resistance at 22,000-22,200 levels. But in case of a downtrend, the index may test April lows around the 21,750-21,800 zone, experts said.
On May 9, the Nifty 50 plunged 345 points or 1.55 percent to 21,958, and the BSE Sensex dropped 1,062 points or 1.45 percent to 72,404, while the market breadth was majorly in favour of bears as six shares declined for every advancing share on the NSE. The Nifty Midcap 100 index and Smallcap 100 index corrected 1.85 percent, and 2.8 percent respectively.
Stocks that bucked the trend and recorded healthy performance despite weakness in benchmarks as well as broader markets, included M&M, Infosys, and Macrotech Developers. Mahindra and Mahindra hit a fresh record high intraday, before closing the session 1.4 percent higher at Rs 2,212.55 on the NSE, and formed a bullish candlestick pattern with a long upper shadow on the daily charts, indicating profit booking pressure at higher levels. The trading volumes remained higher than average.
Infosys continued to consolidate after showing a nice recovery from multi-month lows seen on April 19 this year. On Thursday, the stock rose 0.86 percent to Rs 1,439.55, formed a bullish candlestick pattern on the daily charts and closed above the 10-day exponential moving average (EMA).
Macrotech Developers climbed 1 percent to Rs 1,123.65, but formed High Wave kind of candlestick pattern on the daily charts, after falling in the previous four consecutive sessions, raising the possibility of a bounce back. The stock traded with above-average volumes.
Here's what Shrikant Chouhan of Kotak Securities recommends investors should do with these stocks when the market resumes trading today:
The stock was in a sloping channel from the past few sessions. Eventually, its downward move stopped near the important demand zone. Moreover, the counter has found support at its short-term moving averages on the daily scale.
Unless it is trading below Rs 1,070 positional traders can retain an optimistic stance and look for a target of Rs 1,220 in the coming horizon.
Last Thursday, the stock registered a fresh all-time high of Rs 2,256.75. Despite weak market sentiment, it held positive momentum throughout the day. Technically, on daily charts, the stock is holding higher high and higher low formation and currently, it is comfortably trading above short-term averages, which is largely positive.
For the trend-following traders now, Rs 2,150 would act as a key support level. Above the same, the bullish texture is likely to continue. On the higher side, it could move up to Rs 2,275-2,300. On the flip side, below Rs 2,150, the uptrend would be vulnerable.
After a short-term correction, the stock took the support near Rs 1,375 and reversed. Post reversal the stock is trading near the 20-day SMA (simple moving average) and is also holding higher bottom formation on intraday charts, which is largely positive. For the positional traders now Rs 1,400 would act as a sacrosanct support zone.
Above the same, the stock could bounce back to Rs 1,500-1,525. However, below Rs 1,400 traders may prefer to exit from the trading long positions.
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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