One buy and one sell, short to medium term opportunities

Published February 06, 2019

The market showed a small gain Tuesday, and Nifty 50 (NIFTY) ended the day at 10934 points, which is an increase of 0.20 per cent. The index has now risen for the fourth day in a row.

383 shares were up and 1113 were down, while 46 remained unchanged, and there was no trading in 259 shares.

Just like in the last few analyses, where we published analyses for stocks that gave good trading opportunities through a breakout, we keep the trend going and write about one positive and one negative stock.

Hexaware Technologies (HEXAWARE.NS) Close: 356.35

Hexaware Technologies Limited has broken up through the ceiling of the rising trend in the medium term. Based on our research, this signals an even stronger rate of growth.

The price has risen strongly since the positive signal from rectangle formation at the break through the resistance at 333. The objective at 353 is now met, but the formation still gives a signal in the same direction.

The stock has support at rupee 330 and 315 and resistance at rupee 390. The volume balance is positive and strengthens the stock in the short term. The stock is overall assessed as technically positive for the short to medium term.

Bharat Heavy Electrica (BHEL.NS) Close: 58.85

Bharat Heavy Electricals Limited is inside a falling trend channel in all time frames; short, medium and long term. This shows that investors over time have sold to lower prices to get out of the stock.

The stock has recently broken down from its major support at 65 rupees on very high volume and the short to medium term volume balance indicator, as indicated by red arrows on the bottom right corner of the chart, is now negative.

RSI is below 30 after the falling prices of the past weeks. The stock has strong negative momentum and further decline is indicated. However, particularly in big stocks, low RSI may be a sign that the stock is oversold and that there is a chance for a reaction upwards.  There is resistance around 65-66 and 73 area. But no clear support is visible in the price chart so potential downside can be deep.