Equity benchmark is expected to trade in a rangebound manner until the Nifty 50 decisively surpasses its previous record high of 21,593 zone, with immediate support at 21,300-21,200 levels, while the rising volatility to fresh nine-month high may be signalling a discomfort for bulls, hence, overall the caution is warranted, experts said.
On December 26, the Nifty 50 was up 92 points at 21,441, and the BSE Sensex rose 230 points to 71,337, while the market breadth was in favour of bulls as three shares advanced against two falling shares on the NSE. The Nifty Midcap 100 index climbed 0.65 percent and Smallcap 100 index was up 0.14 percent.
Stocks that recorded healthy returns on Tuesday included Deepak Nitrite, Divis Laboratories, and Mazagon Dock Shipbuilders. Deepak Nitrite shares climbed to the highest closing level since January 21, 2022, rising nearly 4 percent to Rs 2,472 and formed long bullish candlestick pattern on the daily chart with robust volumes after breakout of long horizontal resistance trendline adjoining multiple touchpoints.
Divis Laboratories has seen a breakout of downward sloping resistance trendline and formed strong bullish candlestick pattern on the daily timeframe with healthy volumes. The stock jumped 4.6 percent to Rs 3,863.5 and traded above all key moving averages (20, 50, 100 and 200-day EMA - exponential moving averages), which is a positive sign.
Mazagon Dock Shipbuilders ended at record closing high of Rs 2,288, up nearly 8 percent and formed healthy bullish candlestick pattern on the daily charts with strong volumes. The stock has seen a breakout of falling resistance trendline as well as horizontal resistance trendline, and traded above all key moving averages, which is a positive sign.
Here's what Omkar Patil of Ashika Group recommends investors should do with these stocks when the market resumes trading today:
The stock of Deepak Nitrite has successfully emerged from a substantial base ranging between Rs 2,380-1,800 levels, which formed over a year. Breaking out of an Ascending Triangle pattern with significant volumes, the stock has recently exhibited a surge in volumes, indicating a prolonged build-up in price.
The MACD (moving average convergence divergence) has shown a positive crossover above the zero-line, reflecting the presence of positive momentum.
Investors are encouraged to consider buying this stock with a target set at Rs 2,720, and the suggested stop-loss is at Rs 2,380 on a closing basis.
Divis Laboratories is currently trading at its 52-week highs, indicative of its robust momentum. Recently, the stock broke out of the Inverse Head & Shoulder Pattern, indicating the continuation of the prior uptrend. The breakout has been accompanied by higher trading volumes, confirming the breakout.
The MACD has shown a positive crossover above the zero-line, reflecting the presence of positive momentum.
Investors can explore buying this stock with a target of Rs 4,200, and the recommended stop-loss is at Rs 3,740 on a closing basis.
Mazagon's stock has shown a change in the polarity of its prices around the level of Rs 1,940, illustrating the positive undertone of the prices. The stock recently witnessed an upsurge in volumes with a breakout in prices, indicating the continuation of the prior uptrend. The stock above short-term moving averages confirms the presence of an uptrend.
Investors can consider buying this stock with a target at Rs 2,500, and the suggested stop-loss is at Rs 2,210 on a closing basis.
Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
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