The market remained in the bear hug for the third straight session following weakness in global peers, dragged by FMCG, IT and Metal stocks, on October 21. But the banking and financials and auto stocks curtailed the losses.
The BSE Sensex corrected more than 300 points to close way below the 61,000 mark, while the Nifty50 settled below 18,200 levels, down nearly 90 points. The broader markets also caught in selling pressure as the Nifty Midcap 100 and Smallcap 100 indices slipped 0.4 percent and 0.8 percent.
The stocks that were in focus include Shoppers Stop which was locked in 20 percent upper circuit and closed at Rs 336.70, the highest level since March 2020. IRB Infrastructure Developers also witnessed huge buying interest and saw multi-year high, closing at Rs 244.70, the highest level since May 2018, up 15.32 percent.
Here’s what Shrikant Chouhan of Kotak Securities, recommends investors should do with these stocks when the market resumes trading today:
On October 21, the stock registered a fresh 52-week high of Rs 254.60. In this month so far, it rallied over 27 percent. On daily and weekly charts, the stock has formed breakout continuation pattern which is grossly positive for the IRB Infrastructure Developers.
The intraday time frame indicates that the stock is in to overbought zone and high chances of quick short-term price correction is not ruled out if the stock trades below Rs 235.
For the next few trading sessions, Rs 235 would be the trend decider level for the bulls. If it sustains above the same, there could be continuation of the uptrend up to Rs 258.
Further uptrend may also continue which could lift the stock to Rs 270. On the flip side, dismissal of Rs 235 could possibly trigger quick short-term correction till Rs 227-220.
On Thursday, the stock hit the 20 percent upper circuit. After a strong rally, it has been consolidating between Rs 270 to Rs 290 price levels, but finally it cleared the psychological resistance of Rs 300 and successfully closed above the same which is largely positive.
On daily and weekly charts, it has formed robust price volume breakout formation. We are of the view that, as long as it’s trading above Rs 310-315, breakout texture is intact and further upside is possible from current levels.
For the breakout traders, Rs 310 would be the immediate support level. Above the same, the uptrend wave is likely to continue up to Rs 355-385. On the flip side, below Rs 310 uptrend would be vulnerable.
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