INSUBCONTINENT EXCLUSIVE:
NEW DELHI: NSE barometer Nifty50 kicked off March derivatives series on a solid note, settling last week a tad above its 200-day moving
In the process, 74 stocks formed bullish crossovers on NSE, as suggested by momentum indicator moving average convergence divergence, or
Technically, this signals more upside for these stocks
The fact that many of these stocks have also been witnessing strong trading volumes of late is adding credibility to the emerging
trend.
Engineers India looks set to rally
The technical indicator has signalled an upward crossover, meaning a bullish signal, on the counter
Dabur India, Lupin, Mindtree, Repco Home, TVS Motor, Sequent Scientific, Network18 Media and MCX are some on other stocks that look positive
The list also includes Hero MotoCorp, Dr Reddy's Labs, MOIL, Karur Vysya Bank, ABB India and CESC
The MACD is known for signalling trend reversal in traded securities or indices
It is the difference between the 26-day and 12-day exponential moving averages
A nine-day exponential moving average, called the signal line, is plotted on top of the MACD to reflect 'buy' or 's ell'
opportunities.
When the MACD crosses above the signal line, it gives a bullish signal, indicating that the price of the security may see an
upward movement and vice versa.
Meanwhile, 12 stocks showed bearish crossovers on the daily charts, indicating that these stocks may see
downsides in the days ahead
They included Eicher Motors, Tourism Finance Corporation, Endurance Technologies, Asian Hotels (West) and Aditya Birla Nuvo
The MACD indicator should not be seen in isolation, as it may not be sufficient to take a trading call, just the way a fundamental analyst
cannot give a 'buy' or 's ell' call using a single valuation ratio.
Traders should make use of other indicators such as Relative Strength
Index (RSI), Bollinger Bands, Fibonacci Series, candlestick patterns and Stochastic to confirm an emerging trend.
In case of Nifty50, it has
clearly formed a 'double bottom' on the daily chart, said IIFL Securities
It has also surged and tested its critical zone of 10,870-10,900, which is the confluence of the resistance area
"A break above the resistance would lift Nifty higher towards the 11,000 level, with the 10,800 mark being a key support," the brokerage
ICICIdirect sees a resolve in Nifty50 to move out of the upper band of its consolidation range (10,900), unfolding the next leg of upward
move towards 11,400 level in the coming months
"Volatility would remain high in the runup to the elections, which should be capitalised as an incremental buying opportunity in the
10,750-10,600 range," it said.
UNDERSTANDING MACDA close look at the stock chart of Engineers India shows whenever the MACD line has
breached above the signal line, the stock showed an upward momentum and vice versa.
On Friday, the scrip settled 2.71 per cent higher at Rs
