By Nagaraj Shetti
Nifty surged up sharply during late hours of trade on Wednesday and closed the day with decent gains of around 140 points. After opening on a positive note, the market shifted into a range movement with positive bias for the better part of the session. The sharp buying emerged towards the end and Nifty closed near the all-time high of 18816 levels. A long bull candle was formed on the daily chart with a minor upper shadow. Technically, this pattern indicates a continuation of upside momentum in the market.
After showing a choppy movement in the last couple of sessions the market displayed a strong upside momentum towards the later part of session. This is a positive indication. The positive chart pattern of higher tops and bottoms continued on the daily chart. Though Nifty placed near the higher top around 18800 levels, still there is no indication of reversal pattern forming at the highs. The underlying trend of Nifty continues to be positive and one may expect further upside in the near term. Immediate support is placed at 18680 levels and the upside target remains intact around 18950-19000 levels (0.786% Fibonacci Extension).
Buy HEG Ltd- (CMP Rs 1065)
The weekly timeframe chart of HEG Ltd indicates an upside bounce after a consolidation movement of last week. We observe a formation of higher bottom at Rs 956 in mid of Nov 22. Currently, the stock price is moving up steadily thereby confirming bottom reversal pattern. The overall weekly chart pattern indicates completion of a larger downtrend in the stock price and a resumption of renewed buying interest from the higher lows.
The stock price is now placed at the cluster hurdle of weekly 10 and 20 EMA and down sloping trend line around 1080-1120 levels. Hence, a sustainable move above this area is expected to have a sharp positive impact ahead. Buying can be initiated in HEG Ltd at CMP (Rs 1065), add more on dips down to Rs 1030, wait for the upside target of Rs 1160 in the next 3-5 weeks. Place a stoploss of Rs 995.
Buy Tejas Networks Ltd – (CMP Rs 655)
After the formation of bullish candlestick patterns like doji and bullish hammer on the weekly chart in the last two weeks, the stock price has started to move up in this week so far. The stock price has formed a bottom reversal pattern at the strong support of Rs 600 levels as per the concept of change in polarity. The volume has started to pick up and the weekly RSI shows positive indication. Buying can be initiated in Tejas Networks Ltd at CMP (655), add more on dips down to Rs 630, wait for the upside target of Rs 720 in the next 3-5 weeks. Place a stoploss of Rs 610.
(Nagaraj Shetti is a Technical Research Analyst at HDFC Securities. Views expressed are the author’s own. Please consult your financial advisor before investing.)