Given the decisive breakout of consolidation range with the market hitting a new historic high at the start of March F&O series, bulls took a control over bears and Dalal Street. Hence, experts expect the Nifty 50 to climb towards 22,500-22,600 zone in the coming session, with immediate support at 22,200, followed by key support at 22,000 mark.
On March 1, the Nifty 50 jumped over 350 points or 1.7 percent to 22,339 and formed long bullish candlestick pattern on the daily charts with above average volumes, while the BSE Sensex rallied 1,245 points or 1.7 percent to 73,745.
But the gains in broader markets were less compared to benchmarks. The Nifty Midcap 100 index was up 0.9 percent and Smallcap 100 index rose half a percent, while the market breadth was positive as two shares advanced for every declining share on the NSE.
Stocks that recorded better performance compared to benchmarks and broader markets included Tata Steel, IndusInd Bank, and Jindal Steel & Power. Tata Steel climbed 6.5 percent to Rs 149.95, the highest closing level since August 17, 2021, and formed robust bullish candlestick pattern on the daily charts with significantly higher volumes.
IndusInd Bank smartly defended its 200-day EMA (exponential moving average) many a times in the recent past. The stock has seen a breakout of downward sloping resistance trendline and climbed 3.5 percent to Rs 1,526.65, forming long bullish candlestick pattern on the daily scale with above average volumes.
Jindal Steel & Power has also seen a decisive breakout of falling resistance trendline and recorded 6 percent rally to end at new closing high of Rs 822.85. The stock has formed robust bullish candlestick pattern on the daily timeframe with strong volumes, while it traded above all key moving averages.
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:
Over last few months, Tata Steel has experienced a remarkable rally, with its stock price surging approximately 36 rupees, leading to a notable return of 31 percent within this short period. This rapid ascent has undoubtedly enhanced the appeal of the stock, drawing attention from investors enticed by its recent upward trajectory.
However, despite the current attractiveness of the counter, it is imperative to exercise caution due to the significant resistance looming around the 150-155 range, primarily identified through the presence of a bearish AB=CD pattern as depicted in the chart analysis.
Therefore, initiating fresh long positions at this juncture is not advisable. For individuals who have already entered the market, it is prudent to consider booking profits and adopting a wait-and-see approach, anticipating a meaningful correction in the stock's price before contemplating further investment actions.
In the preceding four-month period, Jindal Steel has undergone a substantial uptick in its stock valuation, marked by an impressive surge of approximately 241 rupees. This surge, constituting a remarkable 42 percent return within this condensed timeframe, positions the company as an appealing option for investors seeking considerable profitability.
The pronounced upward trajectory in the stock's performance has undeniably seized the attention of investors, enticing them with the potential for lucrative returns driven by the recent surge in momentum. However, amidst the allure of the current stock trajectory, a cautious stance is warranted.
In-depth analysis of the chart data reveals a significant resistance zone spanning Rs 830-840 range, notably characterized by the presence of a bearish AB=CD pattern. This technical indication signals potential obstacles for further upward mobility in the stock price.
Consequently, it is not advisable to initiate fresh long positions at this juncture. For investors who have already established positions, prudent consideration should be given to capitalizing on profits and exercising patience. One should wait for a substantial correction in the stock's price.
After reaching a peak near Rs 1,695 mark, IndusInd Bank experienced a significant downturn of almost 267 rupees, representing a substantial drop of approximately 15.75 percent in its price. However, over the last two months, the stock has formed a triple bottom structure between the 100 and 200-day exponential moving averages (DEMA), presenting an enticing opportunity at its current position.
Recent trading activity has seen IndusInd breaking through the bear trendline while simultaneously showing bullish divergence on daily stochastics, indicating a favourable outlook for the stock. Consequently, investors may consider initiating fresh long positions within the range of Rs 1,505-1,530, with an upside target of Rs 1,600. To manage risk, a stop-loss order could be placed near Rs 1,475 on a daily closing basis.
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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