Published March 21, 2019
Wishes of Holi to all readers!
The market showed a flat development and Nifty 50 (NIFTY) ended the day at 11521 points or 0.10 per cent down from Tuesday's close. The index thereby pressed its breaks after seven days of gains.
Few Nifty 50 stocks including Reliance Industries are making all time highs which are pushing the index higher and closer to its earlier peak. But same is not the case with the Midcap and Smallcap indices. Where Nifty Midcap 100 index is still trying to recover from its lows in February, Nifty Smallcap 100 has given a breakout from the falling trend channel and a double bottom formation at the same time. This clearly suggests that the mid and small cap stocks must have really good interest from the investors to catch up with large cap stocks.
ICICI Lombard General (ICICIGI.NS) Close: 979.85
ICICI Lombard General is inside a rising trend channel in the medium term and has given a positive breakout from the rectangle formation. Further rise to 1157 or more is signalled. The stock has support at rupee 920.
As per Investtech's research, stocks that have given buy signal, break upwards from rectangle formation have given an annualized return of 21.1 per cent and excess return of 8.0 percentage points over benchmark index.
Recommendation one to six months: Positive
Punjab National Bank fell more than 70 per cent from its peak in October 2017 and has now started to correct upwards. Two weeks back the stock broke out of the falling trend channel and gave a buy signal from an inverted head and shoulders formation. Very recently the stock has also broken above its resistance of 90 rupees. Further rise to 123 or more is signalled. Support is around 90 and 84.50 rupees in the short term.
Volume balance is positive and the momentum indicator RSI is rising and above 70. These indicators together support the rise in price. However, one must be careful as volatility risk is high with 24 per cent on a monthly basis.
Recommendation one to six months: Positive
Escorts Limited has broken out of the falling trend channel and multiple resistance levels in the medium term. The stock had given a sell signal from a head and shoulders formation last year and fell sharply. But over the course of the last six months the stock made higher tops and higher bottoms to rise above the resistance of 800 rupees. Further rise in price is expected.
RSI is above 70 after a good price increase the past weeks. The stock has strong positive momentum and further increase is indicated. The volume balance indicator is also positive, as more buyers have bought the stock at rising prices and number of sellers has decreased when the stock reacted downwards. The stock is overall assessed as technically slightly positive for the short to medium term.
Recommendation one to six months: Positive
Sanofi India Limited has broken down from the rising trend channel in the medium term. In the first place that signals a slower rate of rise or a development in to more of a sideways trend. However, in this case the stock has given a sell signal from a double top formation, which is a top reversal pattern. Further downside to price target of 4600 rupees or less is signalled.
There is support around 5240 and 4830 rupees, but in case of a reversal there is resistance between 5700 and 6070. Short term volume balance is negative and the momentum indicator RSI-curve is falling and under 30. This suggests that investors are selling when the price falls and less buy interest during reversals.
In the long term chart, a similar price formation has appeared and the support is around 5000 and next at 4700 rupees. The stock is overall assessed as technically negative for the short term.
Recommendation one to six months: Negative
The analyses are based on closing price as per March 20, 2019. Maintaining proper stop loss is always recommended.
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The content provided by Investtech.com is NOT SEC or FSA regulated and is therefore not intended for US or UK consumers.
Investtech guarantees neither the entirety nor accuracy of the analyses. Any consequent exposure related to the advice / signals which emerge in the analyses is completely and entirely at the investors own expense and risk. Investtech is not responsible for any loss, either directly or indirectly, which arises as a result of the use of Investtechs analyses. Details of any arising conflicts of interest will always appear in the investment recommendations. Further information about Investtechs analyses can be found here disclaimer.
The content provided by Investtech.com is NOT SEC or FSA regulated and is therefore not intended for US or UK consumers.