Bulls are still in total control

Mumbai: The benchmark indices witnessed volatile trading session near its 49,700 resistance level. Today, the Sensex opened on a strong note but due to tepid global cues and consistent selling pressure at higher levels, it corrected over 700 points from the day's high. However, in the late afternoon it trimmed some losses and finally closed near 49,500.

On the domestic front, once again PSU Bank index outperformed, rallied over three per cent whereas, profit booking was seen in selective pharma stocks.

"We are of the view that, the bulls are still in total control, but daily chart showing temporary pause near 49,700, hence, traders may prefer caution near resistance level," says Shrikant Chouhan, EVP, equity technical research at Kotak Securities.

Technically, the index still maintains higher high and higher low series. However, on daily chart the Sensex has formed Hammer candlestick reversal formation which suggests high chance of quick intraday correction.

Correction cannot be ruled out if Sensex trades below 49,100. Below 49,100 correction is likely to continue up to 49,000-48,650. On the other hand, 49,700 would be the immediate hurdle for the bulls, above the same, the index could rally till 49,850-50,000."

Stock Picks

♦ SUN TV_Above 540 with a target of 550 and Stop loss of 530. It is on the verge of a breakout and rally could further continue.

♦ ULTRATECH CEMENT_Above 5700 with a target of 5800 and Stop loss of 5600. It has a support of 21 and 55 DMA.

♦ BALRAMPUR CHIN_Above 187 with a target of 192 and Stop loss of 182. It has a support of 8 and 40 DMA.

♦ ITC_Above 213 with a target of 219 and Stop loss of 208. It is trading in an upward trending channel.

♦ TATA MOTORS_Above 249 with a target of 260 and Stop loss of 238. It has formed a support of 8 AND 40 DMA.

(Source-CapitalVia)