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Trade Spotlight | What should you do with IFB Industries, Metro Brands, Mindtree on Friday?

Technically, on daily charts, Mindtree has formed higher bottom formation which is broadly positive for the near term. It also formed promising bullish candle on monthly charts, that also indicating continuation of uptrend in the near future.

July 29, 2022 / 06:19 AM IST
 
 
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It was another strong day for the market as the benchmark indices had a gap-up opening and sustained rally throughout the session to close with nearly 2 percent gains on July 28, the expiry day for the monthly series, after the Federal Reserve as expected raised interest rates by 75 bps on Wednesday.

The BSE Sensex climbed more than 1,000 points to 56,858, while the Nifty50 jumped nearly 300 points to 16,930 and formed bullish candle on the daily charts.

The broader space also joined the bulls' party but the gains were little less compared to benchmarks. The Nifty Midcap 100 and Smallcap 100 indices gained more than 0.8 percent each as about 1,135 equity shares advanced against 812 declining shares on the NSE.

The volatility index India VIX fell by 6.16 percent to 17.01 levels, making the bulls more comfortable. If it falls further below 15 levels, then the bulls may keep tight control over Dalal Street, experts said.

Stocks that were in action included IFB Industries which rallied 10.6 percent to Rs 1,001, the highest closing level since April 6 and formed robust bullish candle on the daily charts with far higher than average volumes. In fact, with Thursday's rally, the stock recouped all its losses seen in previous couple of weeks. If we see the trend of last three days, then there was Morning Star kind of pattern formation, which is generally reversal pattern.

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Metro Brands climbed 9.6 percent to end at record closing high of Rs 637. The stock has formed large bullish candlestick pattern on the daily charts with high volumes and surpassed its previous resistance points by one single candle.

Mindtree shares had a Gap up opening and rose 6 percent to Rs 3,325.40, the highest closing level since May 6. The stock has seen a bullish candlestick pattern formation on the daily charts with robust volumes.

Here's what Shrikant Chouhan of Kotak Securities recommends investors should do with these stocks when the market resumes trading today:

IFB Industries

After a short term correction, the stock took the support near 50 days SMA (simple moving average) Rs 900 and bounced back sharply. Post reversal it rallied over 11 percent. It also formed long bullish candle on daily charts which is grossly positive.

We are of the view that the promising reversal formation of the stock is indicating further upside from the current levels. For the swing now, Rs 980-975 would act as a trend decider level. Above which it could move up to Rs 1,030-1,065. On the flip side, below Rs 975 it could slip till Rs 950-925.

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Metro Brands

On last Thursday, the stock rallied nearly 10 percent. On July 28, Metro Brands not only cleared the medium term resistance of Rs 625 but succeeded to close above the same, which is grossly positive.

On the daily and weekly charts, the stock has formed strong promising price volume breakout formation that indicating bulls are clearly dominating the price action.

For the breakout traders now, Rs 620-610 would be the key levels to watch. The overall chart structure suggests if the stock sustained above the same then breakout continuation texture likely to continue up to Rs 660-680.

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Mindtree

Technically, on daily charts, the stock has formed higher bottom formation which is broadly positive for the near term. It also formed promising bullish candle on monthly charts, that also indicating continuation of uptrend in the near future.

For the positional traders now, Rs 3,200 would be the sacrosanct support zone. And if the stock succeeds to trade above the same, then it could move up to Rs 3,500-3,600. On the flip side, below Rs 3,200 uptrend would be vulnerable. Below the same, it could slip till Rs 3,000-2,950.

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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.
Sunil Shankar Matkar
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