Benchmark index Nifty50 ended the session with a gain of 235 points, as bulls returned on D-Street following a few volatile and corrective sessions. The headline index formed a bullish candlestick pattern for the day, closing comfortably beyond the cluster of recent highs between 17,300-17,360. A sustained trade beyond 17,400 will extend the uptrend taking the index higher to the levels of 17,500-17,600. However, failing to trade and sustain above 17,400 will bring back the choppy sessions, dragging the Nifty index lower to the levels of 17,320-17,250.
RSI has also turned up from the oversold zone and previous reversal area of 30, suggesting that an extension of the uptrend may be possible in the coming sessions. Moreover, India VIX has cooled off from the recent highs of 24, and now, a move below 18 will further ease the nerves of the market participants which can take markets higher.
Equity recommendation
Buy at CMP Rs 1780
Target: Rs 1900
Stop Loss: Rs 1700
The stock has broken out of the consolidation pattern on good volumes, resuming the uptrend. RSI has also turned upwards from the upper-end of the bull zone which confirms the bullishness.
Dr Lal Path Labs
Buy at CMP Rs 3793
Target: Rs 4050
Stop Loss: Rs 3650
The stock has broken out of the consolidation phase on good volumes after forming a double bottom at the 3300-level, suggesting bullishness. Further, RSI has also turned upwards after making a positive reversal, suggesting bullishness.
(The author, Aditya Agarwala is Senior Technical Analyst at YES Securities. Views are his own.)
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