Technical Analysis of BreakOut Stocks for Short Term Trading – January 12, 2022

Stocks to Buy for Short Term - Jan 12

Stock Recommendations
by Ruchit Jain Last Updated: 2022-01-24T13:18:18+05:30

Read here about breakout stocks, its meaning and what are the breakout stocks for today.

Breakout Stocks: What are the breakout stocks for today?

A breakout is a phase where stock price moves outside a consolidation with increased volumes. Such breakouts generally lead to good price movement in short term and this is one of the proven method for selecting buy best share to trade for short term. In this column, we inform our readers the breakout stocks today which can be considered as best short term stocks.

We cover the stocks which have given a breakout from the resistance or stocks which have broken their important support levels. Shares which given a breakout above its resistance with good volumes should be referred for bullish trades which stocks which breaks their supports should be referred for bearish trades. 

The stocks given are for reference and traders are advised to take their own decision and trade with proper money management.
Today, we have picked two stocks which have given a breakout (or breakdown) from a consolidation phase as per technical analysis.

 

Best Stocks to Trade for Short Term

1. United Spirits (MCDOWELL-N):


United Spirits Share Price Chart

Image Source: Falcon

 

In last two months, the stock has seen a pricewise as well a time wise correction. However, the broader trend for the stock is positive and this just seems to be a corrective phase within an uptrend. In the later part of Tuesday’s session, we witnessed some buying interest in the stock where price upmove was supported higher than recent daily average volumes. The stock is on the verge of breakout of this corrective phase and hence, we could see a resumption of the broader uptrend.


Thus, short term traders can look to trade with a positive bias and buy in the range of Rs.915-910 for a potential target of Rs. 958-965 in the near term. One can place a stop loss below Rs. 885 on long positions.

 

United Spirits Share Price Target -

Buy Range – Rs.915 - Rs.910

Stop Loss – Rs.885

Target Price 1 – Rs.958 - Rs.865

Holding Period – 1-2 weeks

 

 

2. Gujarat Alkalies (GUJALKALI):

 

 

Gujarat Alkalies Share Price Chart

Image Source: Falcon

 

Post the sharp upmove in prices in the months of September and October, the stock went through a corrective phase wherein the stock prices corrected from Rs. 846 to Rs.570 by the end of November. Since then, prices have seen some consolidation and on the longer time frame charts, the broader trend still remains positive. The volumes during the upmove were good while during the corrective phase, the volumes were low which is a positive sign. In Tuesday’s session, prices gave a breakout from this short term consolidation and hence, the stock seems to have resumed its uptrend.

Hence, traders can look to trade with a positive bias and buy on dips in the range of Rs.710-700 for a potential target of Rs.765-770. One can place a stop loss below Rs. 678 on long positions.

 

Gujarat Alkalies Share Price Target -

Buy Range – Rs.710 - Rs.700

Stop Loss – Rs.678

Target Price 1 – Rs.765 - Rs.770

Holding Period – 2 weeks

 

 

Disclaimer:The investments discussed or recommended may not be suitable for all investors. Investors must make their own investment decisions based on their specific investment objectives and financial position and only after consulting such independent advisors as may be necessary.

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About the Author

Ruchit Jain is Lead Research Analyst at 5paisa. He has a vast experience of 14 years in this field and is proficient in Technical and Derivatives Research. He has completed his CMT (U.S.A.) and has done Masters in the field of Finance at Mumbai University.

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