Bulls seem to be in a strong position, helping the benchmark indices scale new heights. Considering the strong momentum, the Nifty 50 is expected to climb over 22,800 level in the coming session and if it manages to sustain the same for a few trading days, then 23,000 is likely to be seen soon, while the 22,500 is going to be the key support, experts said.
The consistent higher-high-higher-low formation and the index closing above the upward sloping resistance trendline & trading above all key moving averages also supported the market sentiment.
On April 10, the benchmark indices ended at new closing highs. The Nifty 50 jumped 111 points to 22,754, and the BSE Sensex rose 354 points to 75,038, while the Nifty Midcap 100 and Smallcap 100 indices gained 1 percent and 0.7 percent.
Stocks that recorded better performance than midcap and smallcap indices on April 10 included Tanla Platforms, Navin Fluorine International, and GMM Pfaudler. Tanla Platforms has seen a strong consolidation breakout and formed long bullish candlestick pattern on the daily charts with strong volumes. The stock rallied 7.5 percent to Rs 986 and now traded above all key moving averages.
Navin Fluorine International has also seen a consolidation breakout and rallied 6 percent to Rs 3,246 with healthy volumes. The stock has formed a big, bullish candlestick pattern on the daily timeframe, and traded above 10, 21 and 50-day EMA, but still way below 200-day EMA (exponential moving average).
GMM Pfaudler also jumped 6 percent to Rs 1,423 and formed a strong bullish candlestick pattern on the daily charts after breakout of three-day consolidation, with healthy volumes. The stock is now 72 rupees away from 200-day EMA (placed at Rs 1,495).
Here's what Jigar S Patel of Anand Rathi Shares & Stock Brokers recommends investors should do with these stocks when the market resumes trading today:
In September 2023, GMM Pfaudler peaked around Rs 1,896 mark but has since encountered a notable downturn, witnessing a significant decline of 36 percent. However, in the subsequent eight trading sessions, there has been a remarkable turnaround.
GMM Pfaudler has rebounded substantially from support levels within Rs 1,250-1,300 zone and is currently hovering near Rs 1,400 mark. Particularly noteworthy within this price range is the emergence of a bullish butterfly pattern on GMM Pfaudler's daily chart.
Furthermore, on a daily scale, the relative strength index (RSI) has displayed consistent bull divergence, indicating a strengthening bullish sentiment for the counter.
As a result, investors might consider buying in small portions within the range of Rs 1,375-1,425 and potentially again within the range of Rs 1,335-1,355 (if this level is tested), with a target set at Rs 1,600. To manage risk, a stop-loss order should be placed near Rs 1,275 on a daily closing basis
Following its double top formation near Rs 4,900-4,800 zone, Navin Fluorine has experienced a significant downturn, shedding 41 percent. However, in the last 5-6 trading sessions, it has found support near Rs 3,000 mark.
Concurrently, a Bullish Butterfly pattern has materialized on Navin Fluorine's daily chart, signaling a potential reversal in trend. Moreover, regular bull divergence has been identified on the RSI daily scale, indicating strengthening bullish momentum.
Based on these technical indicators, investors may consider initiating long positions within the range of Rs 3,150-3,250. The upside target for this trade is set at Rs 3,550. To manage risk, a stop-loss order should be placed near Rs 3,025, helping to limit potential losses in case the trade doesn't perform as expected.
Over the past year, Tanla has been undergoing a corrective phase following its peak at Rs 1,300. Throughout this correction, the stock corrected 40 percent, ultimately hitting a low of approximately Rs 780. However, a recent development on the Tanla weekly scale has garnered significant interest.
The aforementioned correction was halted precisely near the 0.618 percent retracement level of its previous major upswing, spanning from March 2023 to July 2023, as indicated on the chart. Coincidentally, the completion of the 1:1 leg also aligns precisely with the 0.618 percent retracement level, further bolstering bullish sentiment for the stock.
Additionally, on the indicator front, the weekly RSI has formed an impulsive structure, resembling a V-shape, near the oversold zone of 30, providing further confirmation of bullish sentiment.
Given these technical signals, investors may consider adding long positions within the range of Rs 950-980. The upside target for this trade is set at Rs 1,250. To manage risk, a stop-loss order should be placed near Rs 825 on a daily closing basis.
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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