The market remained in an uptrend for yet another session with benchmark indices rising third of a percent on October 6 but there was outperformance in broader markets.
The BSE Sensex rallied more than 150 points to 58,222, and the Nifty50 rose nearly 60 points to 17,332, while the Nifty Midcap 100 and Smallcap 100 indices gained a little more than 1.2 percent each.
But the rally was not broadbased as technology, metal and select auto and bank stocks gained, whereas select FMCG and healthcare stocks closed in the red.
Stocks that were in action and reported better performance compared to broader markets included Persistent Systems which had a strong gap-up opening and jumped nearly 8 percent to close at Rs 3,552.75, forming big bullish candlestick pattern on the daily charts with robust volumes. It has managed to touch downward sloping resistance trend line adjoining April 5 and August 19.
Bharat Forge was also in full swing, seeing a strong gap-up opening and rising 8 percent to settle at Rs 764 and formed robust bullish candle on the daily charts. The stock recouped most of recent losses in a single day run-up.
Praj Industries shares gained 7 percent to close at Rs 444, the highest closing level since June 2007 and formed strong bullish candlestick pattern on the daily charts with healthy volumes, making higher high formation for the sixth consecutive session.
Here's what Shrikant Chouhan of Kotak Securities recommends investors should do with these stocks when the market resumes trading today:
On last Thursday, the stock rallied over 7 percent and registered a fresh multi-year high of Rs 453.70. On daily and weekly charts, the stock has formed promising range breakout formation and also formed long bullish candle.
A promising price volume range breakout formation supports further uptrend from current levels. For breakout traders, Rs 430 and Rs 425 would be the key levels to watch out for. The overall chart structure suggests if the stock sustained above the same, then breakout continuation texture will likely continue up to Rs 465-475.
After quick short-term correction, the stock took support near 200-day SMA (simple moving average - Rs 702) and bounced back sharply. After reversal, in this week so far, the stock has rallied nearly 10 percent and formed a long bullish candle on weekly charts.
For the bulls now, 50 and 20 day SMA (simple moving average - Rs 741 and Rs 745) would be the important support level to watch out for, above which, it could move up to Rs 800.
On the flip side, trading below Rs 740 may increase further weakness up to Rs 710.
On last Thursday, the stock rallied over 8 percent. On the weekly and daily charts, it has formed a strong bullish candle which supports further uptrend from current levels.
In addition, it successfully cleared the 50 day SMA or Rs 3,459 resistance zone and succeeded to close above the same which supports further uptrend from current levels.
For swing traders, Rs 3,455 or 50 day SMA (simple moving average) could be the key level to watch out for and if the stock manages to trade above the same then we can expect uptrend continuation wave up to Rs 3,660.
On the flip side, below Rs 3,455 uptrend would be vulnerable.
