The market is expected to consolidate in the coming sessions with key support at 22,300, after Friday's (April 26) profit-booking following an upward journey in the previous five straight sessions. But in case the index manages to surpass 22,500 and hold for a few days, then the journey towards 22,700-22,800 is likely to be seen soon, experts said.
On April 26, the Nifty 50 fell 150 points to 22,420 and formed a Dark Cloud Cover pattern — a bearish reversal trend — on the daily charts. But, for the confirmation of the trend, the following day's candle needs to be checked.
The BSE Sensex was down 609 points at 73,730, while the Nifty Midcap 100 and Smallcap 100 indices continued northwards for the sixth consecutive session, rising 0.8 and 0.6 percent, respectively.
Stocks that bucked the benchmark indices trend on Friday included Biocon, Havells India, and Engineers India. Biocon has seen a (breakout?) of its downward sloping resistance trendline, near the highs of February 6 and April 24, and formed a strong bullish candlestick pattern on the daily charts, with robust volumes. The stock rallied 5 percent to Rs 306, its highest closing level since August 30, 2022, and traded well above all key moving averages.
Havells India, too, saw a breakout of its falling resistance trendline, adjoining the highs of March 2 and April 8, and formed a big bullish candlestick pattern on the daily timeframe with healthy volumes. The stock jumped 5 percent to end at a record closing high of Rs 1,640 and traded above all key moving averages.
Engineers India has also seen a breakout of its downward sloping resistance trendline, adjoining the peaks of February 2 (record high), and April 8, and rallied 6.7 percent to Rs 237. The stock has formed a long bullish candlestick pattern on the daily charts with strong volumes and traded above all key moving averages.
Here's what Rajesh Malviya of Axis Securities recommends investors should do with these stocks when the market resumes trading today:
Biocon
The stock has decisively surpassed its past one-year "multiple resistance" zone at Rs 300 levels on a closing basis, indicating a strong comeback of the bulls. This breakout is accompanied by huge volumes, which signals increased participation.
On the daily, weekly, and monthly timeframes, the stock has witnessed a trend reversal as it has confirmed higher top and bottom formations. The stock has recaptured its 20, 50, 100, and 200-day SMA (simple moving average) and rebounded sharply, which confirms the bullish trend.
Its daily and weekly "Bollinger band" buy signal indicates increased momentum. The daily and weekly RSI (relative strength index) is in positive terrain, which signals rising strength.
Investors should buy/hold this stock with an expected upside of Rs 345-385, with a downside support zone of Rs 290-280.
Havells India
The all-time high of Rs 1,652 that the stock hit last Friday indicates bullish sentiment. It has decisively broken out of the past eight weeks' ``multiple resistance" zone of Rs 1,600 levels on a closing basis, which implies a positive bias.
Rising volumes on breakout confirm increased participation. The stock is well placed above its 20, 50, 100, and 200-day SMA, and these averages are also inching up along with the price rise, which reconfirms the bullish trend.
The daily and weekly RSI is in positive terrain, which signals rising strength.
Investors should buy/hold this stock with an expected upside of Rs 1,840-1,900, with downside support at Rs 1,600-1,560 levels.
Engineers India
The stock is in a strong uptrend across all timeframes, forming a series of higher tops and bottoms, indicating positive bias. On the daily timeframe, the stock has confirmed an "Inverse Head and Shoulder" breakout at Rs 228 levels, indicating positive bias. This breakout is accompanied by huge volumes, which shows increased buying interest.
The stock is well placed above its 20, 50, 100, and 200-day SMA, which confirms bullish sentiment. The daily, weekly, and monthly RSI is in positive terrain, which signals rising strength.
Investors should buy/hold this stock with an expected upside of Rs 270-285, with downside support at Rs 222-213.
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