INSUBCONTINENT EXCLUSIVE:
NEW DELHI: The New Year may have started on a dull note for domestic equities, but a smart bounce in benchmark indices during last four
sessions has made many stocks look strong on technical charts.
On NSE, 63 such stocks may advance in coming days, as suggested by momentum
indicator moving average convergence divergence, or MACD.
The technical indicator has signalled an upward crossover, meaning a bullish
signal, on these counters, hinting at possible upsides
Many of these stocks have also been witnessing strong trading volumes of late, adding further credibility to emerging trend.
The list
includes a host of blue chips such as ICICI Bank, HCL Technologies, Lupin and Ambuja Cements.
Others included Jayshree Tea, PVR, Phillip
Carbon, Mahindra CIE Auto, Aegis Logistics, Future Lifestyles, Godrej Agrovet, Vinati Organics and SP Apparels, among others.
The MACD is
known for signalling trend reversals in traded securities or indices
It is difference between 26-day and 12-day exponential moving averages
When MACD crosses above signal line, it gives a bullish signal, indicating that price of security may see an upward movement and vice
versa.
Meanwhile, 30 stocks showed a bearish crossover on daily charts
They include Tata Steel BSL (erstwhile Bhushan Steel), Asian Paints, CESC, Mercator, Omaxe, Sunteck City and Ducon Infratech.
The MACD
indicator should not be seen in isolation, as it may not be sufficient to take a trading call, just way a fundamental analyst
cannot give a
Bollinger Bands, Fibonacci Series, candlestick patterns and Stochastic to confirm an emerging trend.
As for Nifty50, it is ruling below its
If it breaches this level, it will unfold next leg of rally towards 11,050, 11,200 levels.
Sameet Chavan of Angel Broking believes index may
find support in 10,840-10,800 range.
Meanwhile, daily strength indicator RSI continued to remain flat in overbought zone, indicating absence
But momentum oscillator Stochastic continued to scale up, signalling that upside momentum may continue in near term, said Rajesh Palviya,
Head of Technical Derivatives Analyst at Axis Securities.
UNDERSTANDING MACDA close look at stock chart of HCL Technologies shows whenever
MACD line has breached below signal line, stock has showed a downward momentum and vice versa.
On Tuesday, scrip traded 0.49 per cent lower
