INSUBCONTINENT EXCLUSIVE:
NEW DELHI: The bears seem to have gained an upper hand on Dalal Street
A sharp drop in the Nifty50 over the past three days has pushed the index below the 10,250 mark, making traders wonder whether it is headed
But technical charts are giving mixed signals across counters
signalling a major downturn in these stocks.
The charts also showed some 19 stocks were poised for a rally
These counters have also been witnessing strong trading volumes of late, adding further credibility to the emerging trend.
Among the stocks
that looked weak were largely NBFCs, small banks and companies from the construction, infrastructure and real estate sectors
They include NCC, Indiabulls Real Estate, RBL Bank, HDFC, Bharat Financial, AU Small Financial, Ambuja Cements, MEP Infrastructure and
Heidelberg Cement, among others
Sugar stocks Bajaj Hindustan and Dhampur Sugars, healthcare stocks Marksan Pharma and Dr Lal Pathlabs and consumer stocks Bata India,
Kansai Nerolac and Manpasand Beverages too looked weak on the technical charts
The MACD is known for signalling trend reversal in a traded security or index.
MACD is the difference between the 26-day and 12-day
exponential moving averages
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.
Nineteen stocks, including IOC, Biocon, Power Grid, Allcargo Logistics, DCM Shriram and Ajanta Pharma, showed bullish
crossover on the daily charts.
Coffee Day Enterprises, Va Tech Wabag, Tube Investments, V Mart Retail and Birla Corporation were among the
MACD indicator should not be seen in isolation and it may not be sufficient to take a trading call, just the way a fundamental analyst
Relative Strength Index (RSI), Bollinger Bands, Fibonacci Series, candlestick patterns and Stochastic along with MACD to confirm an emerging
trend and take an investment call.
On Monday, the Nifty50 faced resistance at the 10,400 level, but managed to respect its resistance in the
At present, Nifty is in Wave B of the pullback, and Wave C i.e the next leg of the pullback, is expected on the upside
Understanding MACD
A close look at the stock chart of Indiabulls Real Estate shows whenever the MACD line has breached below the signal
line, the stock tended to show an downward momentum and vice versa.
On Monday, the stock fell 1.86 per cent to Rs 74 on NSE.
