The benchmark Nifty-50 index ended sharply lower amidst intra-day selloff to form a bearish engulfing candlestick pattern after bulls failed to push the Index beyond the key resistance hurdle of 17,850-17,900. Further, the index has entered a trading band between 17,900 and 17,950 on the upside and 17,600-17,500 on the downside.
Breakdown from the lower end of the range i.e. 17,600 may trigger deeper corrections dragging the Index lower to levels of 17,450-17,300. On the flip side, if bulls manage to keep the Index above 17,600 in the coming sessions, then a short covering rally could be on cards taking the Index back to levels of 17,750-17,900. Moreover, with a spike in the fear gauge, India VIX, Indian markets could remain choppy and volatile.
| Buy at CMP of Rs 727
Target: Rs 775
Stop Loss: Rs 695
The stock has broken out of a consolidation pattern on good volumes triggering a resumption of the uptrend. Technical indicator RSI has turned upwards after forming a positive reversal suggesting strength in the stock.
HDFC Bank | Buy at CMP of Rs 1614
Target: Rs 1,675
Stop Loss: Rs 1,580
The stock has resumed its uptrend after breaking out of a sideways consolidation resistance on good volumes. Further, RSI has also turned upwards above the 60 levels after formation of a positive reversal pattern suggesting strength.
(The author, Aditya Agarwala, is Senior Technical Analyst, YES Securities. The views are his own.)