There is a possibility of further upside in the short-term. Immediate support is placed around 11,100-11,150 and the key overhead resistance is placed at 11,350-11,380
Bulls managed to make a comeback on D-Street snapping the 3-day losing streak on Monday. The momentum on D-Street helped the S&P BSE Sensex to reclaim 38,000 while the Nifty50 managed to hold above 11,200 levels.
Let’s look at the final tally on D-Street – the S&P BSE Sensex rose 173 points to 38,050 while the Nifty50 closed with gains of 68 points at 11,247.
Sectorally, the action was seen in power, metal, auto, and consumer discretionary stocks while some selling pressure was visible in energy, and telecom space.
The Nifty witnessed a sustainable counter-trend rally on Monday and closed the day higher by 68 points. Daily 14-period RSI is placed around the upper 60 levels.
According to the pattern, RSI turning up from 60 levels could mean more further strengthening of upside momentum in the market ahead, but a close above 11,366 could put bulls back in control, suggest experts.
“A sustainable move above 11,366 is expected to negate a bearish engulfing pattern completely. Such negation is likely to have a more positive impact on the underlying ahead, as per the theory of false downside breakout,” Nagaraj Shetti, Technical Research Analyst, HDFC Securities told Moneycontrol.
“There is a possibility of further upside in the short-term before showing any downward correction again from the new swing highs. Immediate support is placed around 11,100-11,150 and the key overhead resistance is placed at 11,350-11,380,” he said.
We have collated views of an expert on stocks that were in focus on Monday:
Expert: Vikas Jain, Senior Research Analyst at Reliance Securities.
The stock has broken from its weekly Doji and crossover of its long-term averages on the daily charts that confirms an upward move.
The weekly RSI closed above its average-line indicating a strong breakout and the sector is also in positive momentum.
Multiple support levels in the range of 89-92 levels would be protected and offer a good risk-to-reward ratio from current levels.
The stock has given a breakout on various time frames with strong volumes post its results announcements. We believe that the current up move will extend near to its 100-week average at Rs 490 mark and any decline near to today’s low to fill the gaps will be a good opportunity to add longs.
Sterlite Technologies: Hold| Target: Rs 185
The stock is facing resistance near Rs 160 levels which is also its 21-Month average and crossover of the same would give a strong move.
The daily RSI is placed above 60 levels indicating bullish setup for the stock. We expect some pullback to fill the gap levels of today’s move and then expect an upward momentum in the stock.
Thyrocare Technologies: Hold | Target: Rs 900
The prolonged range bound move and crossover of the long term averages have given a breakout last month to scale near to all-time high.
It has clocked one of the highest volumes since its listing and we expect to scale an all-time high of Rs 870 levels of 2017.
As the up move is very sharp on daily charts one should avoid fresh exposure and wait for declines to enter, while existing investors can hold for a new high.
Disclaimer: The views and investment tips expressed by 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.