Chart Busters: Top trading set-ups to watch for Friday
The markets saw a strong opening today. NIFTY opened with a gap-up following strong global cues and ended the day with gains. Although some paring of gains was witnessed during the day, the benchmark index posted a decent gain of 246.55 points or 1.53%. In the process, the NIFTY has formed a higher top and higher bottom on the charts; it also made a black body on the candle as it closed lower than it opened. The RSI continues to show a bullish divergence against the price. The markets are expected to consolidate; in the event of any move on the higher side, the zone of 16800-16950 will act as a strong resistance area for the NIFTY.
Along with the other FMCG and consumption stocks, GODREJCP has also relatively underperformed the broader markets over the past several months. After marking a high near 1125 in September, the stock has remained in a structurally corrective mode over the past five months. It violated major double bottom support near 690. However, this violation was for a very short time and the stock has bounced back above this support level. The RSI has crossed above 30 from the overbought area which is bullish. The volumes increased in the last phase of the decline which also is a sign of a formation of a potential base. If the technical pullback happens, the stock may test 740-770 levels over the coming days. Any close below 665 will negate the view.
PVR appears to have been trapped in a defined trading range between 1540 and 1670 levels. The zone of 1640-1670 has been an area of multiple resistance for the stock. Presently, few signs have appeared that hint towards a likely upward revision in the price over the coming days. The OBV – On Balance Volume has marked a new high ahead of the price breakout. The stock also remains in the leading quadrant of the RRG when benchmarked against the broader NIFTY500 index. The RS line against NIFTY 500 has hit a new high and remains above the 50-DMA and is in a structural uptrend. The MACD has shown a positive crossover; it is now bullish and above the signal line. The stock may test 1700-1745 levels over the coming days. Any close below 1640 will negate this view.
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