The market fell for a third straight session on May 18 despite a northward journey in all its global counterparts, as selling was seen in auto, FMCG, pharma, oil & gas, select metal and information technology (IT) stocks.
The BSE Sensex was down 129 points at 61,432, while the Nifty50 dropped over 50 points to 18,130, the lowest closing since May 5 this year. The index has formed a bullish candlestick on the daily timeframe, with lower highs and lower bottoms for three days in a row.
We saw selling pressure in broader markets, too, as the Nifty midcap 100 and smallcap 100 indices declined around half a percent each on weak breadth.
However, Bank Nifty performed better, rising more than 50 points to 43,752 and formed a bearish candlestick on the daily scale, making higher highs and higher lows.
Stocks that were in action included KRBL, which gained 2.5 percent at Rs 408.5, and formed a bullish candlestick with a long upper shadow on the daily scale, indicating profit-taking at higher levels. It made higher highs and higher lows with above-average volumes. Overall, the stock remained above all key moving averages (50, 100 and 200-day exponential moving averages).
HEG rose 1.5 percent to Rs 1,241.5, the highest closing since September 2, 2022, and formed a bullish candle with a long upper shadow on the daily timeframe. The volume was above average. The stock has been in a smart uptrend since the beginning of April despite intermittent correction and consolidation.
Poonawalla Fincorp climbed over 2 percent to end at a record closing high of Rs 336 and formed a bullish candle on the daily scale with strong volumes. The stock made a higher top and a higher bottom formation.
Here's what Shrikant Chouhan of Kotak Securities recommends investors should do with these stocks when the market resumes trading today:
The stock has given a breakout of its Ascending Triangle chart pattern with a strong bullish candlestick. On the daily charts, it has formed a higher bottom formation, hence the structure of the counter indicates the beginning of a new up move.
For positional traders, Rs 325 would be the trend-decider level. Trading above the same uptrend formation will continue till Rs 360 but if the stock closes below Rs 325, traders may prefer to exit long positions.
The stock is trading in a rising channel pattern after reversal from the lower levels and has formed the higher lows series continuously on the daily scale. The strong bullish momentum suggests that the counter is likely to maintain a bullish continuation chart in the coming horizon.
For traders, Rs 395 will act as an important support zone, while Rs 440 could be the key resistance area for short-term traders. The uptrend, however, will be vulnerable below Rs 395.
On the daily and weekly scale, the stock is trading in a rising channel chart formation, making higher tops and higher bottoms constantly. As a result, major technical-trend indicators such as the relative strength index (RSI) and average directional index (ADX) are strong and steady.
The upward movement is very likely to continue in the coming horizon. Unless it is trading below Rs 1,199, positional traders can retain an optimistic stance and look for a target of Rs 1,330.
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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