We have seen correction in equity benchmarks for the second consecutive session, but there was some support-based buying indicated by the chart pattern on January 7 as the Nifty50 has formed a bearish candle with long lower shadow on the daily charts. It took a good support at 17,700 level amid cautious trade ahead of the Monetary Policy Committee decision over interest rate scheduled for February 8.
In fact, the Bank Nifty performed better than broader markets on Tuesday, rising 116 points to 41,491.
The Nifty50 fell over 40 points to 17,721, and the BSE Sensex slipped more than 200 points to 60,286, while the Nifty Midcap 100 index was down 0.02 percent and Smallcap 100 index declined 0.7 percent on weak market breadth.
Stocks that outpaced broader markets on Tuesday included Varun Beverages which gained nearly 7 percent to Rs 1,304, the highest closing level since January 9 and formed long bullish candle on the daily charts for second straight session, making higher high higher low formation for second day in a row.
Oil India shares climbed 4.5 percent to Rs 225 and formed strong bullish candle on the daily charts with above average volumes. Also there was Morning Star kind of pattern formation after recent correction, which is bullish reversal pattern.
CG Power and Industrial Solutions was also in focus, rising 2.6 percent to end at record closing high of Rs 315.3 and formed bullish candle on the daily charts, with trading well above all short term as well as long term moving averages, while holding an upward sloping support trendline adjoining lows of December 26, 2022, January 27 and February 1, 2023.
Here's what Vaishali Parekh of Prabhudas Lilladher recommends investors should do with these stocks when the market resumes trading today:
The stock has retraced 38.20 percent from the peak zone made near Rs 1,430 level and taken support near Rs 1,100 to indicate a pullback with bullish candle patterns on the daily chart to improve the bias and suggest for further rise in the coming days.
The stock has decisively moved past the significant 50-day EMA level of Rs 1,235 zone to show strength and with the RSI (relative strength index) indicating a trend reversal has signalled a buy with further upside potential visible for the medium term time frame.
We suggest to buy this stock for an upside target of Rs 1,430 level keeping the stop-loss of Rs 1,220.
CG Power and Industrial Solutions
The stock has been in a strong trending mode with an ascending channel pattern on the daily chart indicating a decent bull run amid this volatile market. The trend is maintained intact with strength indicated and can carry on with the momentum still further upside targets visible near Rs 345-350 zone in the coming days.
The near support would be around the important 50-day EMA level of Rs 290 and one can hold or accumulate the stock for further gains.
With the RSI also well placed and indicating strength with upside potential visible, we suggest to buy or accumulate this stock for an upside target of Rs 345-350 keeping a stop-loss near Rs 290.
The stock has improved the trend in the past 3-4 months with an ascending channel pattern indicated on the daily chart, with recently support taken near Rs 210 level and indicating a positive bullish candle pattern to imply strength and bias on the improvement.
The RSI has indicated a trend reversal with immense upside potential indicated and has further upside targets open till Rs 255-260 zone.
We suggest to buy and accumulate the stock keeping the stop-loss near Rs 210 level and expect for decent returns.
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