Sectorally, selling was seen in capital goods, metals, healthcare, and energy stocks while some buying was visible in power, utilities, consumer durables, and FMCG stocks.
Stocks that were in focus include names like Ratnamani Metals which rose more than 6%, Dr Reddy’s Laboratories which fell nearly 7% and Firstsource Solutions which closed near its 52-week high on Thursday.
Here’s what Amol Athawale, Deputy Vice President – Technical Research, Kotak Securities Ltd recommends investors should do with these stocks when the market resumes trading today:
Ratnamani Metal: Below 2325 uptrend would be vulnerable
The stock has rallied over 20% so far in this quarter. Last Thursday, it opened on a gap-up note and registered a fresh all-time high of 2528.
However, due to profit booking at higher levels, it trimmed some intraday gains. We are of the view that the short-term texture of the stock is bullish but mildly overbought.
Hence, we could expect rangebound activity in the near term. Technically, 2350-2325 would be the immediate support level while on the upside, 2525 -2550 could be the immediate hurdle for the bulls.
On the flip side, below 2325, the uptrend would be vulnerable.
Dr. Reddy’s Laboratories: Weak momentum is likely to continue
After a promising uptrend rally, the stock corrected sharply. This week, it has corrected by over 8%. A sharp reversal formation and long bearish candle on weekly charts indicate further weakness from the current levels.
Technically, as long as the stock is trading below the 50-Day SMA (Simple Moving Average) or 4650, weak momentum is likely to continue.
Below the same, the stock could slip towards Rs 4500-4425. On the other side, a minor pullback rally is possible if the stock succeeds to trade above 4570.
A close above the same could move the stock higher towards Rs 4600-4620.
FSL: Profit booking at higher levels
The stock has rallied nearly 25% so far in this quarter. After reversal formation, the stock successfully cleared the medium-term resistance of 125, and post the breakout, it intensified the positive momentum.
On the daily and weekly charts, the stock has formed a breakout continuation formation. We are of the view that the short-term texture of the market is bullish but due to temporarily overbought conditions we could see some profit booking at higher levels.
For trend-following traders, buying on dips and selling on rallies would be the ideal strategy. Technically, 127-125 would be the key support zones while 137-143 could be the immediate profit booking area for the bulls.
On the flip side, below 125, traders may prefer to exit from the trading long positions
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)