After a good start to the Samvat 2080 and hitting the crucial resistance of 19,550, market participants took some money off the table on November 13, pushing the index to settle around its 50-day EMA (exponential moving average) of 19,447 and hold above the 21-day EMA of 19,392. Hence, the Nifty50 moving towards 19,550-19,600 seems likely in the coming sessions and if it sustains above this level, then 19,850 can't be ruled out, as long as it holds 19,400-19,300 as a support area, experts said.
The Nifty50 fell 82 points to 19,444, and formed a bearish candlestick pattern on the daily charts with lower highs, lower lows formation, while the BSE Sensex declined 326 points to 64,934.
Stocks that bucked the trend included Union Bank of India, Hindustan Copper, and MCX India. Union Bank of India has seen a breakout of horizontal resistance trendline and formed a strong bullish candlestick pattern on the daily scale, with healthy volumes. The stock jumped over 7 percent to Rs 112 and traded above all key moving averages (21, 50, 100 and 200-day EMAs), which is a positive sign.
Hindustan Copper has also seen a breakout of downward sloping resistance trendline and climbed 8 percent to Rs 162 on the NSE. The stock has formed robust bullish candlestick pattern on the daily timeframe with significantly higher volume, and traded above all key moving averages.
MCX India rallied nearly 4 percent to end at record closing high of Rs 2,775 and formed long bullish candlestick pattern on the daily scale with above average volumes. The stock continued uptrend for third straight session and traded well above all key moving averages, while on the monthly charts, it has been in an uptrend since the month of May.
Here's what Ashish Kyal of Waves Strategy Advisors recommends investors should do with these stocks when the market resumes trading today:
Hindustan Copper showed a classic buying in the previous trading session. The stock appears to be back at its recent swing high, which is close to Rs 163 levels. If we examine the chart closely, we can observe that a significant price action area is located at Rs 163. Therefore, a clear breach of it might lead to an even greater increase in this stock.
Along with that, 50 period exponential moving average (Rs 149) has provided classic support in this rise.
So, one should be in the direction of ongoing trend as long as stock holds above this line. As per this, support comes near Rs 149 levels and one can expect a move to Rs 180 levels.
MCX has been on sequential rise for several months now. We have applied Supertrend which shows that the uptrend is intact. RSI (relative strength index) reading is at 76 which indicated very good momentum in the stock.
The bull run is likely to continue in the future and any opportunity on the downside should be used to enter the stock as the RSI will get relieved or add to the existing position. From wave perspective we are in the wave 3 thus uptrend in the stock will continue in the coming sessions.
Thus, short term trend for the stock is positive, with a target Rs 3,500 and support near Rs 2,380 levels.
In the previous session, Union Bank of India rallied with good volumes. PSU banks have been the flavor of the season and are showing good volumes and momentum for past few months now.
On the below chart, we can see that prices are consolidating and now giving rise with good volumes. We have applied Bollinger Bands and RSI indicator. From technical perspective, the stock has closed above the upper bands of the Bollinger Bands. RSI reading is at 68 thus momentum is very good in the counter. Prices are likely to go higher in the coming sessions.
In the nutshell, the stock is bullish for move to Rs 125 as long as support near Rs 104 is intact.
Follow Ashish Kyal on Twitter - @kyalashish
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