Index in bull horn mode, but need to be cautious; 5 stocks to buy or sell

Index has risen little above 16% in less than 4 months which is very strong upside movement. In week gone by, Index has breached tight consolidation patch on higher side with gain of 1.34%. It is bullish breakout. Looking at other side of the coin, from the bottom of 16800 to 19600, Index has risen in patch of 5% with 0.5% deviation. Recent upside movement has also reached around 5%. However there is no reversal sign yet but one need to be caution at current levels. In previous move, Index has gone through pricewise to time wise correction for 5 days before resumption of fresh up move. In short term, Index will remain in positive zone above 19300 level.

From strategic index perspective, Microcap and small cap stocks did well. Index derived a good strength from IT, metal, realty and pharma stocks while round of profit booking observed in financial stocks specifically PSU banks, CPSE and consumer durable stocks.

Bull Horn stocks

CONCOR weekly chart. Source: Finlearn Academy

CONCOR Weekly Chart (CMP: 690)

Stock has risen from the lower band of 100 week consolidation and breached immediate high. In such consolidation patch, stock travels to upper band which is placed around 750 level. Stock has breached its previous peak (in circle) which is bullish continuation sign. Bullish view will be negated below 665 level.

Granules daily chart. Source: Finlearn Academy

Granules Daily Chart (CMP: 309)

Pharma sector is in positive momentum and every dips offers good opportunity to buy. Stock has formed large consolidation followed by breakout. It can be considered as double bottom pattern breakout which is bullish reversal sign, it indicates dominance of buyers over sellers. Stock is rising in upward channel. Positive view will be negated below 300 level and it has immediate resistance at 330 level.

SunTV weekly chart. Source: Finlearn Academy

SUNTV Weekly Chart (CMP: 495)

In such extended market, some stocks like SUNTV has underperformed a lot but now started to have catch up rally. Stock is rising from 138 weeks consolidation patch followed by breach of immediate resistance which shows bull’s strength. Bull’s will hold their fort above 570 level and it has upper resistance at 570 level.

Bear Ears

Atul Auto weekly chart. Source: Finlearn Academy

Atul Auto Weekly Chart (CMP: 6547)

Chemical is worst performing sector in recent bullish market. Almost all the stocks are under bear’s grip. Atul stock is travelling in downward sloping wedge pattern and it has tested the upper arm with bearish follow up sign. Moving below 6500 can lead to further bearishness upto 6200 level. Short term bearish view will be negated below 6650.

Deepak Nitrate Weekly Chart. Source: Finlearn Academy

Another chemical stock which has reacted from upper band of consolidation with bearish follow up sign. Stock is travelling towards lower band which is placed at 1750 level. Stock will retain bearish view below 2050 level.

The author, Kapil Shah is Technical Analyst at Emkay Global Financial Services and technical analysis trainer at Finlearn Academy.

Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before taking any investment decisions.

Updated: 15 Jul 2023, 07:04 PM IST