Stock Tips : On the first trading day of this week i.e. on Monday, the Indian stock markets were closed by reaching new highs. But after this the market closed on the red mark for four consecutive days. On the second trading day of the week i.e. on October 19, the Sensex had crossed 62 thousand and Nifty 18600 for the first time, but due to profit-taking, this momentum could not be sustained.
Prices are trading with an ascending channel pattern on the daily chart. Higher higher higher bottom formation is being formed on the card. The index is able to close above the lower band of the pattern and the upward sloping trend line is acting as an anchor point for the prices. India VIX index has seen a breakout of a smaller degree horizontal trend line above 16 level and is facing resistance near the 200-week exponential moving average. If the VIX index continues to close above the 15 level, we may continue to see volatility in the coming trading sessions.
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bank nifty
The banking index has outperformed the benchmark index with a bullish trend and has given a return of 2.5 per cent on the weekly chart. Bank Nifty has given a Pennant Pattern Breakout on the Daily Chart. Prices have given an ascending triangle pattern breakout on the weekly chart and continue to trade bullish after the breakout. The momentum oscillator RSI (14) is also forming above the 70 level and a bullish crossover is indicating a strong upside momentum. Currently, the Banking Index is trading above its Parabolic SAR indicator near the level of 37750 on the weekly chart.
The banking index has given returns of around 10 per cent since October 1, indicating a strong outperformance in the banking index. Major resistance is placed near the 41200 level and downside. If the price breaks below 39800 then we can see 39000 level in it. Let us see which stocks are expected to earn better profits.
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On the weekly timeframe, the stock is forming a higher higher higher lower price pattern since the March 2020 low and has given an ascending triangle breakout with increasing volumes. The stock traded above 70 points for almost 18 months and saw a strong breakout that forced the price to close above its 100-week exponential moving average on the weekly timeframe.
The RSI (14) on the indicator closed above the 70 level, which indicates a strong momentum on the higher side with a positive crossover. The decline in Friday’s trading session can be used as a fresh buying opportunity.
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The stock is trading in a higher higher higher bottom formation on the daily time frame, which indicates a progressive uptrend in the counter. Prices are trading within an ascending channel pattern and the lower band of the pattern is getting support from the 21-day exponential moving average. The momentum oscillator RSI (14) on the indicator is hovering near the 60 level and has found support near its previous support zone. The recent price drop can be used as a new over the counter buying opportunity.
(Rohan Patil is a Technical Analyst at Bonanza Portfolio. Views expressed here are those of the author. Please consult your financial advisor before investing.)
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