Sector-wise, selling pressure was seen in metals, realty, consumer discretionary, auto, bank, and IT stocks.
Focused stocks included
which closed with gains of 5 percent, which hit 52-week high and closed marginally higher and which ended with gains of almost 1 percent but with strong volume on Monday.
Here’s what Jatin Gohil, Technical Research and Derivatives Analyst at Securities suggests investors should do with these stocks as the market resumes trading today:
: Hold on
At the end of Jun’22, the stock tested its 38.2 percent Fibonacci Retracement level of prior up-move (Rs 70-344), which was placed at Rs 239, and resumed its up-move.
Later, the stock not only surpassed its prior swing high of Rs 344, but also explored uncharted territory, and recorded a new high of Rs 433. Key technical indicators are in favor of bulls on the main timeframe chart.
The stock has the potential to move to Rs 512 first and Rs 585 next, which coincides with its 100 percent and 127 percent Fibonacci Extension levels of prior up-move, respectively.
The risk-to-reward ratio is not favorable at the current juncture for fresh longs. However, one can hold their position by trailing stop loss.
ITC: Hold on
Since Mar’22, the stock remains upbeat, where it has moved above respecting its 50-day EMA (Rs 295).
Currently, the stock is quite close to its long-term supply zone (Rs 320). The key technical indicators are poised positively in the long term as well as the medium term of the timeframe chart, while due to the steady rise, the short term indicators witnessed a bearish divergence.
In case the stock again fails to exceed the supply zone convincingly, the short-term decline cannot be ruled out. One can hold their longs by trailing stop loss to its 50 day EMA.
However, fresh long positions can be initiated once the stock remains firmly above its long-term supply zone. A steady move above that zone could take the stock towards the age of Rs 368 initially and Rs 400 thereafter.
Tata Communications Limited: buy
On 19th Aug’22, the stock witnessed a trendline breakout and later extended its gains, rising to an almost 4-month high of Rs 1,166. Key technical indicators are in favor of the bulls in the medium and short term timeframe charts.
On the higher side, the stock may face a hurdle around its 200-day SMA (Rs 1,172). However, a stable move above the moving average can lead the stock towards its prior supply zone (Rs 1,330).
On the downside, the stock will find support around its 50-day EMA (Rs 1,034).
(Disclaimer: Recommendations, suggestions, views and opinions given by experts are their own. These do not reflect the views of Economic Times)