Last week Nifty has formed “Bearish Advance Block Pattern” candles consist from 15 March to 17 March and finally Nifty appeared in overbought zone first time after 1 October 2009. Advance block pattern suggest that market is tired and some sign of selling or supply at higher level cannot be ruled out. Daily momentum indicators are hovering in over bought zone. On weekly chart front, from last six week Nifty is making higher highs higher lows but weekly moving average sends tired out signal. Immediate resistance placed at 5310 level and short term important support placed at 5070 level.
HDFC Ltd. (2694)
Stock was continuously up from the mid February and finally it has given trend reversal signal on 18march 2010 where it has formed “DOJI”. On Friday stock has completed “Evening Doji Star” a bearish candlestick pattern and reliability of this pattern is very high as this occurred in over bought zone. Daily momentum indicators have given negative cross over to signal line. On weekly chart front stock has formed “Long Legged Doji” after five weeks of higher highs and higher lows which also suggests tiredness at higher level. Looking at all above parameters trader with moderate risk appetite can consider Sell at current level with tight stop loss of Rs.2718 for a Target of Rs.2625-2610.
Federal Bank (257.60)
After making “Dark Cloud Cover” on 5 March stock was consolidating and finally on Friday Stock has formed “Bearish Engulf” a bearish candlestick pattern on daily chart. 3 days EMA has given negative cross over to 8 days EMA and stock closed below its 20 days EMA. Daily RSI also making lower highs and lower lows which also favors bears. Looking at all above technical parameters trader with moderate risk appetite can consider Sell below 256 with tight stop loss of Rs.260 for a Target of Rs.248.
Chambal Fertiliser (61.10)
Stock was in continuous down trend from the high of 74 in mid February and finally made a bottom on 16 March with “Bullish Engulf” a bullish candlestick pattern. On Friday stock has formed “Long White Candle” with strong volume breakout on daily chart. 3 days EMA has given positive crossover to 8 days EMA. Daily momentum indicators are on the verge of bullish zone. On weekly chart front stock has formed “Piercing Pattern” a bullish candlestick pattern, weekly RSI also showing strength on chart. Looking at all above technical evidence trader with moderate risk appetite can consider Buy above Rs.61.25 with tight stop loss of Rs.58.50 (closing basis) for a Target of Rs.66.