The market fell sharply from its high (18,135) on the Nifty50 to close flat with a positive bias last Thursday and, in the following session on February 17, the index succumbed to selling pressure, closing below psychological 18,000 mark.
But it managed to take a support at downward sloping resistance trendline adjoining highs of December 1 (record high) last year and January 24 this year. Further it has crucial support in the 17,700-17,900 area. Hence, experts still hopeful that the Nifty may take out its January high soon.
The benchmark indices fell half a percent each with the Nifty50 closing at 17,944 and the BSE Sensex at 61,003, while the broader markets were also under pressure with the Nifty Midcap 100 and Smallcap 100 indices declining 0.8 percent and 0.6 percent respectively.
Stocks that we have selected today include Shree Cement, which climbed 2.5 percent to Rs 25,757, the highest closing level since May 2, 2022 and formed strong bullish candle on the daily charts with making higher high formation for fifth consecutive session. It traded with above average volumes.
Ipca Laboratories fell by 3.66 percent to Rs 831 on the NSE, forming large bearish candle on the daily charts with significantly higher volumes. As a result of this correction, the stock moved below all key short and long term moving averages, indicating the mood is in favour of bears.
IndusInd Bank was down nearly 3 percent to Rs 1,115 and formed long bearish candle on the daily charts with making lower high lower low formation, but the volume was below average. It has been falling for sixth consecutive session, and traded below 50-day EMA (exponential moving average).
Here's what Viraj Vyas of Ashika Stock Broking recommends investors should do with these stocks when the market resumes trading today:
The weekly chart shows the formation of a Head & Shoulder pattern and currently the stock is consolidating below the neckline since six months.
Continuing to sustain below the neckline is likely to add pressure. On the daily chart, the stock formed a large bearish bar with strong volume and breakdown below Rs 820 support is likely to see a steep correction towards Rs 700.
The weekly chart depicts how the stock has traded around the polarity level of Rs 26,200. Once a support, is currently a resistance which has been tested on three occasions.
The stock has shown a strong bullish resolve in the last 3 weeks and breakout above the polarity zone is likely to aid fresh bullish momentum as the stock can head towards Rs 30,000-level. Key support is expected at Rs 24,000.
The weekly chart shows resistance at the polarity point (Rs 1,200-mark). The stock is trading in an ascending triangle which is bullish pattern, but the stock has seen multiple failures to breach the level since last 5 months and continuing to sustain below the same doesn't augur well for the recovery move. The stock appears weak and might test Rs 950-900 level on the downside.
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