Indian stock market: A piercing line pattern, typically signaling a bullish reversal post-correction, has emerged on the daily chart. Moreover, the indicator has exceeded the 55EMA, indicating a positive short-term trend with a close above this moving average. In the upcoming period, bullish momentum may propel the Nifty’s rebound towards the 22,300 mark. Additionally, a firm breakthrough above 22,300 could initiate a prolonged rally towards 22,600. Conversely, on the downside, support at a closing basis rests at 22,000.
Bank Nifty
The Bank Nifty Index showcased robust bullish momentum, evidenced by the formation of a bullish piercing candlestick pattern at the support level of 46,500. The index faces immediate resistance at 48,000, where substantial open interest on the call side poses a notable obstacle. Between 47,200 and 47,000, the index has established immediate support. Pullbacks toward this support zone are perceived as opportunities for buying, indicating sustained bullish sentiment as long as these levels remain intact.
Stocks to buy
ICICI Bank: Buy at ₹1,070 | Target Price: ₹1,125 | Stop Loss: ₹1,044
The daily chart displays a piercing line pattern formation, suggesting the possibility of a bullish reversal. Furthermore, the stock has crossed back above the critical short-term moving average. The shorter timeframe RSI (14) is indicating a bullish crossover and is on the rise. Additionally, a hidden bullish divergence is evident on the daily chart. In the short term, the stock could potentially move towards 1,105/1,125 and beyond. Support is positioned at 1,044 on the lower end.
The stock has surged, closing above both its previous swing high and a formidable resistance level at 126. With its current trading position above the short-term 21-day moving average, bullish momentum is evident. This sentiment is further supported by the Relative Strength Index (RSI), which has undergone a bullish crossover, reaching 69. Given these factors, initiating a long position at the current market price seems advantageous. Setting a stop loss at 122 and a target at 135 reflects a bullish outlook for the stock.
DLF: Buy at ₹855 | Target Price: ₹900 | Stop Loss: ₹829
The stock has dipped into the oversold zone on the hourly chart, as indicated by the RSI positioning. Additionally, the RSI is showing a bullish divergence on the hourly chart, hinting at a potential bullish reversal. Furthermore, the stock seems to be finding support around the previous congestion on the daily timeframe. Taken together, the technical setup implies a potential exhaustion of the current bearish trend and a forthcoming recovery.
The author Rupak De is Senior Technical Analyst at LKP Securities.
Disclaimer: The views and recommendations above are those of individual analysts, experts and broking companies, not of Mint. We advise investors to check with certified experts before making any investment decisions.
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Published: 21 Apr 2024, 03:43 PM IST