The market had a wonderful day on February 14 as equity benchmarks snapped a two-day downtrend and closed at a three-week high, tracking positive global cues. The northward journey in FMCG, technology, banking and financial services, metal and oil and gas stocks aided the rally.
The BSE Sensex jumped over 600 points to close above 61,000, and the Nifty50 gained nearly 160 points at 17,930, the highest closing level since January 24. The index has formed a bullish candle on the daily charts with a higher-high-higher-low formation.
The falling volatility also made bulls comfortable on Dalal Street. India VIX, the fear index declined by 1.66 percent from 13.68 level to 13.45 level.
But the broader markets remained under pressure for yet another session with negative breadth. The Nifty Midcap 100 index fell third of a percent and Smallcap 100 index was down fourth of a percent.
Stocks that performed better than broader markets included Rashtriya Chemicals and Fertilisers which rallied nearly 5 percent to Rs 112.4 and formed bullish candle which to some extent resembles bullish engulfing kind of pattern on the daily charts after taking support at around Rs 105 or 200-day EMA (exponential moving average).
Poonawalla Fincorp has decisively broken consolidation range of last one-and-half-month on the higher side with long bullish candle on the daily charts with healthy volumes on Tuesday. The stock closed 3.5 percent higher at Rs 313, the highest closing level since November 29, 2022. Also there was a breakout of long downward sloping resistance trendline adjoining highs of October 19, 2022 and January 24, 2023.
UPL shares rallied nearly 4 percent to Rs 762, the highest closing level since December 19, 2022, and formed strong bullish candle on the daily timeframe with robust volumes on the daily charts. It has been making higher high higher low for third consecutive session, with trading well above all short term and long term moving averages.
Here's what Vaishali Parekh of Prabhudas Lilladher recommends investors should do with these stocks when the market resumes trading today:
Rashtriya Chemicals and Fertilisers
The stock has witnessed a decent correction from the peak level of Rs 144 to show signs of bottoming out near Rs 105 zone forming a double bottom pattern on the daily chart to imply a good support base.
The RSI (relative strength index) indicator has indicated a trend reversal from the oversold zone to signify strength and anticipate for further rise in the coming days with upside potential visible from here on.
The initial target can be anticipated till Rs 126 zone with the support maintained at Rs 105 zone. A decisive breach can carry on the momentum further to next target level of Rs 139 zone.
The stock has indicated a bullish candle pattern on the daily chart to improve the bias and moving past the significant 50-day EMA and 200DMA level of Rs 735 has strengthened the trend and can anticipate for further rise.
The RSI is also on the rise with visible upside potential and can carry on the momentum still further till Rs 805.
With series of higher bottom formation pattern indicated on the daily chart looking attractive, we suggest to buy the stock for an upside target of Rs 805-825 levels with stop-loss of Rs 730.
The stock has indicated a descending channel breakout above Rs 304 level with a positive bullish candle pattern on the daily chart to anticipate for continuation of the momentum till further with next targets of Rs 335-345 zone.
The RSI also has come out of the consolidation phase to improve the bias and strengthen the trend with upside potential visible. And with the chart pattern looking convincing, we suggest to buy the stock for an upside target of Rs 345 with keeping a stop-loss of Rs 300.
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