By Rohal Patil
The Nifty 50 registered its lifetime higher of 15962.25 on July 16 and slipped nearly 380 points or 2.46 per cent in the next two trading sessions. Benchmark Index witnessed a smaller sized degree V shape reversal on the day-to-day chart immediately after forming a low of 15578.55 on July 20, and post that recovered more than 2 per cent in just two consecutive trading sessions.
For the previous seven weeks, the benchmark index had continued to trade in a narrow variety horizontal channel pattern, on the day-to-day charts. The width of the channel pattern is off nearly 3-fifty points exactly where a reduce band of the pattern holds help close to 15600 levels and the upper band of the pattern is close to 15950 levels.
If Nifty is in a position to break the upper band of the pattern which is placed close to 15950 levels then rates may perhaps witness a main breakout which will assistance rates to cross above 16150 levels. Support for the Nifty is placed close to 15768 – 15600 levels.
Bank Nifty – Bulls nevertheless in action
Bank Nifty registered its lifetime higher of 37708.75 on February 16, 2021 and post that the index entered a correction phase. Despite the downside correction, Bank Nifty continues to trade in a greater low formation and made its intermediate low at 30405.65 on April 19, given that then rates have recovered more than 18 per cent in just a period of 3 months.
Bank Nifty on the day-to-day chart is trading inside the increasing channel pattern and at present trading close to the reduce band of the pattern. On the weekly chart banking index is trading above its upward increasing trend line. The greater major greater bottom formation is nicely intact on the weekly chart indicates bulls are nevertheless in action.
If Bank Nifty is in a position to break the horizontal trend line resistance which is placed close to 36000 levels then rates may perhaps witness a main breakout which will assistance rates to cross above 37500 levels. Support for the Bank Nifty is placed close to 33900 levels.
Stocks to Buy
Target – Rs 1365 | Stop Loss Rs 1225
The rates have been trading in a variety of 1100 to 1200 for the nearly two months and have formed rectangle pattern formation on the day-to-day chart. Tata Steel has broken out of a rectangle pattern at 1244 levels on July 9, and the rates have registered a decisive breakout that suggests a adjust in the trend from sideways to upside. In these current correction rates have completed its throwback close to its have a tendency line help which is placed close to 1230 levels.
Stock is trading above its 21, 50 & one hundred- day exponential moving averages on day-to-day 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 close to 60 levels which indicates positive momentum will like to continue ahead.
Target – Rs 680 | Stop Loss Rs 622
Prices traded in a narrow variety in between 607 – 633 levels on the day-to-day chart and formed a resistance zone about 633 – 635 levels.
ICICIPRU has witnessed a horizontal trend line breakout on the day-to-day time frame and the rates are trading above their trend line resistance. Prices are also trading above their brief & medium-term exponential moving typical which is positive for the rates.
When we observe volume activity there has been above-typical volume on the day of the breakout which confirms cost volume breakout on the day-to-day time frame. Momentum oscillator RSI (14) is reading above 60 levels with positive crossover on the day-to-day scale, which indicates the uptrend may perhaps resume quickly.
Crude Oil outlook
WTI CRUDE OIL has been on an upward trajectory given that April 2021. On the weekly chart, WTI CRUDE OIL rates have formed a bullish hammer pattern (bullish reversal) exactly where rates have shown a sharp recovery in the last couple of trading sessions and have formed along trailing tail in the candle. MCX Crude oil has formed a bullish morning star pattern on July 20, 2021, and at present trading above the bullish pattern on the day-to-day scale.
On the weekly chart, WTI CRUDE rates are trading above their upward increasing trend line and continue to trade in a greater higher greater low formation, which is technically a bullish structure for the Oil rates. The momentum oscillator RSI (14) is reading at 51.65 levels and has witnessed a sharp reversal from 40 levels on the day-to-day time frame. Demand development is anticipated to outpace new provide, following the agreement by the Organization of the Petroleum Exporting nations and allies, identified as OPEC+, to add back 400,000 barrels per day every single month from August by way of December. The close to-term help for the WTI Crude Oil rates is placed close to $68 & $66 levels (MCX 5200 & 5000 levels), exactly where resistance is capped close to $75.50 levels (MCX 5630 levels).
(Rohan Patil is a Technical Analyst at Bonanza Portfolio Ltd. The views expressed are the author’s personal. Please seek advice from your economic advisor prior to investing.)