After a correction of 2.7 percent from its peak, the market is likely to consolidate in the coming week with crucial support for the benchmark Nifty index at 19,500 and hurdle on the higher side at 19,800-20,000 levels, experts said. On September 22, the Nifty50 was down 68 points to 19,674, continuing the downtrend for the fourth consecutive session.
The BSE Sensex shed 221 points to 66,009, while the Nifty Midcap 100 index was down 0.1 percent and Smallcap 100 index gained 0.3 percent. India VIX, the fear index, declined 1.45 percent to 10.66 levels.
The key sectoral indices also ended flat with a negative bias. The Nifty Bank index slipped 12 points to 44,612, while the Nifty IT was down 14 points to 32,906.
Stocks that outperformed the broader markets included Housing & Urban Development Corporation (HUDCO), Gujarat Ambuja Exports, and Punjab National Bank. HUDCO has seen a decisive breakout of long downward sloping resistance trendline and formed robust bullish candlestick pattern on the weekly charts with strong volumes. The stock climbed nearly 19 percent to Rs 85.80 on last Friday, with trading above all key moving averages.
Gujarat Ambuja Exports jumped 6 percent to Rs 315 and formed bullish candlestick pattern with long upper shadow on the daily charts. The trading volume was robust, while there was a decisive breakout of long falling resistance trendline, with stock trading above all key moving averages.
Punjab National Bank (PNB) jumped to multi-year high and closed 4.5 percent higher at Rs 77.50 on the NSE, continuing uptrend for fourth consecutive session. The trading volume in last two days was above average, while there was a golden crossover with 50-day EMA (exponential moving average) crossing 200-day EMA during the week gone by, which was a positive sign.
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 strong uptrend across all the time frames forming a series of higher tops and bottoms. Recently the stock has recaptured its 20 and 50-day SMA (simple moving average) and rebounded very sharply indicating strong comeback of bulls. This buying momentum is accompanied with huge volumes which signals increased participation on rally.
On the weekly chart, the stock has confirmed "Cup & Handle" formation breakout at 60 levels which shows positive bias. The daily, weekly and monthly RSI (relative strength index) is in positive terrain indicating rising strength.
Investors should buy, hold and accumulate this stock with an expected upside of Rs 105-120, with downside support zone of Rs 72-68 levels.
On the monthly time frame, the stock has witnessed "multiple resistance" breakout at Rs 65-68 levels along with rising volumes which signifies increased buying interest. The stock is well placed above its 20, 50, 100 and 200-day SMA which reconfirms bullish trend.
The weekly and monthly "band Bollinger" buy signal suggests increased momentum. The daily, weekly and monthly RSI is in positive terrain indicating rising strength across all the time frames.
Investors should buy, hold and accumulate this stock with an expected upside of Rs 90-100, with downside support zone of Rs 68-65 levels.
On the weekly time frame, the stock has confirmed a "descending triangle" breakout at Rs 280 levels indicating resumption of prior uptrend. In the past couple of sessions, the stock has recaptured its 20-day SMA and rebounded sharply which shows positive bias.
The stock is well placed above its 50, 100 and 200 day SMA and these averages are also inching up along with prices which reconfirms bullish trend. The daily, weekly and monthly RSI is in positive terrain indicating rising strength across all the time frames.
Investors should buy, hold and accumulate this stock with an expected upside of Rs 360-380, with downside support zone of Rs 298-273 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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