By Rohan Patil
Nifty 50 traded in a band of nearly 200 points in between September 6 and September 14 devoid of providing any meaningful indication. On September 15, the Benchmark index ultimately witnessed a breakout on the larger side of a narrow variety consolidation pattern and continued to trade larger for the next couple of trading sessions and registered its lifetime higher of 17792 on September 17.
At the start off of last week, we saw a consistency in the advance-decline ratio 2:1 exactly where advancing stocks had been getting the upper hand even in the sideways trend it clearly indicates the accumulation phase for the majority of the stocks. Even FII information at the start off of the week hinted at a robust accumulation in the front line stocks as we have seen more than Rs 3,000 cr getting.
Nifty continues to trade inside the increasing channel pattern on the every day time frame and on the Fridays trading session costs have taken a stiff resistance close to the upper band of the increasing channel pattern and witnessed a profit booking soon after hitting a new lifetime higher in the early trading ticks.
Momentum oscillator RSI (14) is constantly sustaining above 70 levels and at the moment hovering in between 75 – 80 levels on the every day interval. An indicator or oscillator can stay in the overbought zone for a longer duration in the bull marketplace and any dip of an RSI close to its prior low can be utilized for a acquire-on dips approach.
The instant assistance for the Nifty is placed close to 17300 levels which is the decrease band of the pattern and the resistance is capped at 17800 – 17850 which is the upper band of the pattern.
BANK NIFTY
It was a banking-driven week exactly where a BANK NIFTY has registered its new lifetime higher of 38112 on the 17th of Sept and has closed 3 larger on a weekly closing basis.
Bank Nifty has witnessed a breakout of a triangle pattern on the weekly chart and the costs have been capable to close above its trend line assistance. On the weekly chart, costs are trading above upward slanting trend line assistance and a larger higher larger low formation is nicely intact on the broader time frame.
Both Private and PSU banks participated equally in this rally exactly where each the index closed above 4 % on the weekly chart.
On the indicator front, RSI (14) has also witnessed a breakout of a conjunction zone which was formed in between 65 – 60 levels on the weekly interval. The banking index continues to trade above its 21 & 50 – day exponential day moving typical on the every day as nicely as the weekly chart.
As Bank Nifty has provided a breakout soon after nearly seven months so we are expecting an outperformance compared to the benchmark index. The instant assistance for the index is placed close to its upper band of the breakout pattern which is placed close to 37000 levels and the resistance is most likely to cap close to 39000 levels which is uncharted territory.
Hindustan Petroleum Corporation Limited : Invest in
CMP: Rs 283 | Target Rs 300 | Stop Loss Rs 274
Return 06%
On the every day chart, the stock took assistance close to its 21-day exponential moving typical and bounced back with volume confirmation. HINDPETRO has provided an inverted head & shoulder pattern breakout on the every day interval on 15th Sept and costs have been capable to close above its neckline assistance.
Plus DI is placed above the minus DI although the ADX line has began slopping upwards, indicating the stocks is most likely to collect momentum in the coming days. Daily RSI has shown a trend line breakout which is bullish development for the brief term.
On the present juncture, this stock has when once more picked up momentum above the important resistance level of Rs. 275 along with increasing volumes.
Web page INDUSTRIES: Invest in
CMP: Rs 33,121 | Target Rs 35,400 |Stop Loss Rs 32,000
Return 06.80%
A swing trade setup is visible on the every day and weekly timeframe for this stock and is poised to give up to 9% returns in the upcoming trading sessions. The stock has shown a healthier run-up in the last month and a appropriate larger higher larger low cost formation is spotted on the cost action front.
The stock is on the verge of an inverse head and shoulder breakout and the cost is at the moment close to its neckline breakout level. If the stock is capable to sustain above 33450-33480 levels, we may possibly see a main upswing. The cost has taken assistance from its 10 days EMA and in the prior trading session a bullish pin bar is formed which implies there is a rejection of decrease costs and bulls managed to overcome the bears.
On the indicator front, ADX is displaying a reading of 19.70 and is increasing which tells us that the strength of the trend is robust and will get momentum. The MACD has currently provided a positive crossover and is sustaining above its zero lines. RSI hasn’t but entered overbought levels and is displaying a reading of 65 which implies there is upside prospective left in the stock.
(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.)