By Rohan Patil
Technically, Nifty has formed a sturdy bullish candle on the weekly chart which is broadly positive. This Bull run has more legs to go and it is just a matter of time when Sensex will cross the 60000 mark. The month-to-month chart of the benchmark index has provided an 8.69 per cent return for the August series and has formed a tall green candle indicating bulls nevertheless have sufficient strength to trade larger. Nifty 50 is generating new lifetime highs for the fifth consecutive session indicating a sturdy bull industry trend is unfolding.
The intermediate uptrend remains bullish as the benchmark index continues to make larger tops and larger bottoms more than the last many months. Nifty is has been trading above 21 & 50 – week exponential moving averages which give additional proof of an uptrend. The cause behind Nifty outperformance is the help coming from choose massive-cap IT, FMCG and telecom stocks.
There could be throwbacks in the compact time frame due to overbought situations on the quick-term chart, but it would be sensible to use these possibilities to add open positions as it is a obtain on dips industry situation.
As of now, there is no indication of Nifty sliding under the 16800 – 16700 levels, but you in no way know how worldwide development pan out. The resistance is pegged at 17550 levels. The perfect method would be look at the person stocks rather than the benchmark index.
BANK NIFTY
Bank Nifty has lastly broken its consolidation band and has effectively closed above the horizontal trend line help. The modify of polarity idea is seen at the present junction as the earlier resistance level is acting as an quick help zone for the banking index.
We have also seen a breakout in the momentum oscillator RSI (14) as the oscillator has been capable to close above its horizontal trend line resistance placed close to 58 levels with bullish crossover on the everyday time frame. The MACD indicator has also taken help close to its centreline and at the moment moving larger with closing above its signal line indicates strength in the present up move.
On the weekly chart, rates are trading above upward slanting trend line help and a larger higher larger low formation is effectively intact on the broader time frame. The 21 & 50 – day exponential moving typical continues to act as an anchor point and any dip close to these levels will be an chance to add positions in the banking index.
The upside resistance is most likely to be capped close to 37500- 3770 levels. For now, the help level for the Bank Nifty stands at 36200 – 36000 levels.
Torrent Power: Get
CMP: Rs 486 | Target Rs 516 | Stop Loss Rs 470 | Return 6%
The rates had been trading in a rectangle formation given that previous two months and have formed a trend line resistance at 475 levels. TORNTPOWER has broken out of a rectangle pattern at 488 levels on 27th Aug and the rates have registered a decisive breakout that suggests a modify in the trend from sideways to upside.
Stock is trading above its 21, 50 & one hundred- day exponential moving averages on everyday time frame, which is positive for the rates in the close to term. MACD indicator is reading above its centerline with positive crossover above its signal line. Momentum oscillator RSI (14) is reading above 60 levels which indicates positive momentum will like to continue ahead.
HDFC AMC: Get
CMP: Rs 3197 | Target Rs 3390 | Stop Loss Rs 3100 | Return 6%
A swing trade setup is visible for HDFC AMC. The stock can give up to 6 % returns. The momentum is most likely to continue as depicted on the weekly charts. The cost setup appears promising exactly where a cup pattern is visible. On the indicators front, the MACD line has shown a positive crossover on everyday charts and ADX is displaying a reading of 19.60 with a increasing trend. The RSI is however to enter into overbought territory indicating that upside prospective is nevertheless left for the stock.
A falling trend line breakout is also visible, providing a obtain signal that the trend on the downside has been arrested. On the moving typical front, the stock is trading effectively above its 21days EMA indicating that the momentum is sturdy on the upside.
Escorts: Get
CMP: Rs 1321 | Target Rs 1415 | Stop Loss Rs 1268 | Return 7%
The stock has been forming a larger higher larger low formation on the month-to-month time frame given that August 2019, indicating the extended-term trend of the stock remains bullish. The rates have also completed its throwback of the rectangle pattern on the everyday chart close to its trend line help.
RSI (14) plotted in the weekly chart has been hovering above the 50-mark for the last couple of weeks and can be seen moving larger towards the overbought level, indicating the bullish momentum. The level of Rs 1268 (several touch point level) will act as a red-flag level followed by Rs 1247 (50-day exponential moving typical). The technical parameters recommend the stock may perhaps move larger towards Rs 1415. If it breaks Rs 1415, it may perhaps head towards 1450.
(Rohan Patil is a Technical Analyst at Bonanza Portfolio. Views expressed are the author’s personal. Please seek the advice of your monetary advisor ahead of investing.)