Indian equity markets ended the session in the green with Nifty posting gains of 150 points to form a bullish engulfing pattern and recovering 357 points from the low point of the day.
Further, a bullish engulfing pattern following a downtrend suggests a potential temporary bottom formation. Moreover, a sustained trade beyond 16,000 levels will extend this short covering rally taking the index higher to levels 16,200-16,400.
However, failure to hold above 16,000 levels would resume the corrections dragging the index lower to levels of 15,910-15,750.
Technical indicator RSI has also taken support at the 30 level and turned upwards which has previously acted as a reversal zone which also portends to a possible short covering rally may be witnessed in the coming sessions.
Recommendations
COALINDIA
Buy@CMP Rs 189
Target: Rs 202
Stop loss: Rs 181
The stock is on the verge of a breakout from a consolidation phase and turned upwards suggesting a possible short covering rally in the coming sessions. Technical Indicators are also favouring the same.
PFIZER
Buy@CMP Rs 4,380
Target: Rs 4,620
Stop Loss: Rs 4,160
The stock has taken support at the cluster of previous lows suggesting strong support area. Further, volumes have also been low in the recent correction which also suggests that downtrend has been arrested.
(The author, Aditya Agarwala, CMT is Technical Analyst–Research at YES Securities)
Further, a bullish engulfing pattern following a downtrend suggests a potential temporary bottom formation. Moreover, a sustained trade beyond 16,000 levels will extend this short covering rally taking the index higher to levels 16,200-16,400.
However, failure to hold above 16,000 levels would resume the corrections dragging the index lower to levels of 15,910-15,750.
Technical indicator RSI has also taken support at the 30 level and turned upwards which has previously acted as a reversal zone which also portends to a possible short covering rally may be witnessed in the coming sessions.
Recommendations
COALINDIA
Buy@CMP Rs 189
Target: Rs 202
Stop loss: Rs 181
The stock is on the verge of a breakout from a consolidation phase and turned upwards suggesting a possible short covering rally in the coming sessions. Technical Indicators are also favouring the same.
PFIZER
Buy@CMP Rs 4,380
Target: Rs 4,620
Stop Loss: Rs 4,160
The stock has taken support at the cluster of previous lows suggesting strong support area. Further, volumes have also been low in the recent correction which also suggests that downtrend has been arrested.
(The author, Aditya Agarwala, CMT is Technical Analyst–Research at YES Securities)
(Disclaimer: The opinions expressed in this column are that of the writer. The facts and opinions expressed here do not reflect the views of www.economictimes.com.)
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