The market extended losses for two days in a row on April 18, weighed by index heavyweights Reliance Industries, HDFC twins, ICICI Bank and ITC. The BSE Sensex corrected more than 180 points to 59,727, while the Nifty50 lost nearly 50 points to 17,660.
But the index smartly defended the 17,600 level for yet another session, which can be crucial for further direction for the market, experts said.
The broader markets sustained their upward journey for several sessions now. The Nifty Midcap 100 index extended northward move for seventh consecutive session, rising 0.8 percent, while the Nifty Smallcap 100 index gained for 11 days in a row, climbing third of a percent.
Stocks that were in action included Indian Bank which rallied nearly 4 percent to Rs 321.5 and formed bullish candlestick pattern on the daily charts, with strong volumes for yet another session. The momentum indicator MACD (moving average convergence divergence) is showing positive strength, with the counter trading above all key moving averages (21, 50, 100 and 200-day EMA - exponential moving average).
IDFC First Bank also formed bullish candle on the daily scale with above average volumes, as it gained 2.5 percent to close at Rs 56.50. With Tuesday's move, the stock got back above all key moving averages, with making higher highs higher lows for second straight session.
APL Apollo Tubes has decisively broken its consolidation of last several sessions, with forming long bullish candlestick pattern on the daily timeframe with above average volumes. The stock also came back above all key moving averages and closed 3 percent higher at Rs 1,228.
Here's what Rohan Shah of Stoxbox recommends investors should do with these stocks when the market resumes trading today:
Post a strong rally from mid-October 2022 to early December 2022, the price underwent a time wise correction, which continued for about more than 17 weeks. This week, the stock has shown a decisive breakout from prolonged consolidation with surge in volumes and momentum.
Further, from price pattern perspective, the stock has registered a breakout from potential Cup & Handle pattern which is bullish signal for medium term trend.
Moreover, the stock was seen trading above 61.8 percent retracement level of its prior whole decline, which hints stock is poised for a move towards 78.6 percent retracement levels in the near term which is placed around Rs 345-350 zone.
The stock saw a fabulous upmove from June 2022 to December 2022, where the price rallied from Rs 29 to Rs 64 levels. Post that price has seen forming lower highs with horizontal support zone at Rs 52-53.
From the price pattern point of view, the stock has seen trading into descending triangle pattern and currently price saw trading around the falling resistance trendline.
Hence, we believe, breakout from the mentioned pattern, i.e above Rs 57.5-58 zone, the stock shall ignite fresh upwards momentum towards Rs 62-64 levels.
On the weekly time frame, the stock has been forming progressive higher highs and higher lows which signifies bullish trend in the stock. Historically, 20-week EMA has provided key support to the stock for multiple instances and the intermediate decline in the stock has been arrested around the same.
This week price rebounded strongly finding support at 20-week EMA and has formed a wide bullish Marubozu candlestick pattern on the daily chart. Going ahead the stock is expected to move higher towards all time high levels of Rs 1,330 provided its holds above Rs 1,180.
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