By Shrikant Chouhan
The benchmark indices witnessed robust bounce back, the NSE Nifty 50 ended 153 points higher while the BSE Sensex settled 581 points up. Among sectors, reality, media, PSU Banks stocks bounced back sharply whereas some profit booking was seen in metal stocks. Technically, the Nifty 50 index not only cleared the resistance of 15900 but succeeded to close above the same which is broadly positive. In addition, after a sharp decline, the index has formed a promising long bullish candle that also supports a short-term uptrend. We are of the view that, as long as the index is holding 15900/53100 and 15850/53000 support zone, the reversal formation is likely to continue. Above which the chances of hitting 16150-16250/54000-54150 would turn bright. On the flip side, below the 15850/53000 uptrend would be vulnerable.
For the past few weeks, the counter has been trading in a symmetrical triangle chart pattern along with decent volume activity. Furthermore, on the daily scale, a rebound is seen from its rising trend line, which suggests that the counter has enough potential for upside from the current levels. Also, the counter is better placed in terms of risk and reward scenarios.
BPCL BUY, CMP: Rs 341.6, TARGET: Rs 360, SL: Rs 333
The stock has underperformed after hitting the all-time high level and it has witnessed a downtrend. However, in recent past sessions, we witnessed a pause in downward momentum. As a result, the counter is into an accumulation phase near its important support area. Therefore, the formation indicates the resumption of a bullish uptrend in the coming horizon.
Housing Development Finance Corporation (HDFC)BUY, CMP: Rs 2,151.7, TARGET: Rs 2,260, SL: Rs 2,110
On the monthly scale after the remarkable up move, the counter witnessed price correction. However, a strong rebound is seen from the important retracement support zone. The incremental volume activity suggests bullish momentum to sustain in the coming days.
TrentBUY, CMP: Rs 1,078.1, TARGET: Rs 1,130, SL: Rs 1,050
The counter has shown an incredible rally in the recent past and despite weak market conditions the stock is holding firm on higher levels. The structure is representing a bullish continuation chart pattern, which hints at an uptrend to persist in the near term.
(Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities, Views expressed are the author’s own.)
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