Technical Breakout Stocks: How to trade Alok Industries, Sun Pharma and Endurance Technologies on Monday
However, on a weekly basis, Nifty50 closed flat with a negative bias for the week ending January 5, 2024.
Sectorally, buying was seen in IT, capital goods, telecom, and realty, while selling was seen in healthcare, consumer durables, metal, and utilities.
Stocks that were in focus include names like Alok Industries which was up nearly 20%, Sun Pharma, which rose more than 9% to hit a fresh high, and Endurance Technologies, which closed with gains of nearly 10% to hit a fresh all-time high on Friday.
We have collated a list of three stocks that either hit a fresh 52-week highs, or an all-time high or saw a volume or a price breakout.
We spoke to an analyst on how one should look at these stocks the next trading day entirely from an educational point of view:
Analyst: Virat Jagad, Technical Analyst at Bonanza Portfolio
A breakout of the rounding bottom has been witnessed in Alok Industries on a weekly time frame, indicating a bullish trend in the security.
The price is trading at the top, forming a Bullish Marubozu candlestick formation as a sign of strength in the stock.
The security has been supported by the 21-day EMA, and the price is trading above the Fast 50 and Slow 200 EMAs, indicating a positive trend. The volume increase on the day of the breakout indicates that buyers are active in the market.
In the momentum area, RSI is trading in a wider range, indicating that it’s an upward trend. On the directional front, DI+ is trading above DI- hints at a positive trend, and ADX trades above DI- indicating strength in movement.
With a stop loss of Rs 27.6 on a daily closing basis with a target of Rs 36, buy-on dip can be initiated at Rs 29 to Rs 29.8.
Sun Pharmaceuticals Industries
On a weekly frame, Sun Pharma took a breakout of the Flag and pole pattern, a sign of positivity. In this formation, the security formed a bullish price action indicating buyers have been keen to buy the securities and are expecting the stock to move higher till the Rs 1,400 mark.
On the EMA front, the prices are trading above major EMA’s, indicating a positive trend. The Slow EMA (50) is following the trend and trending upward, hinting at a positive trend.
On the momentum front, the RSI is trading in the overbought trajectory, confirming the bullish control over the security.
Hence, based on the above technical reasoning, we might see an upside till Rs 1,400 in the coming period in Sun Pharma.
Endurance Technologies has exhibited a breakout from a symmetric triangle pattern on the weekly time frame. There has been a consistent rise in trading volume, which signifies growing buyer interest.
Additionally, the price is currently trading above the major EMAs, which supports a bullish stance in security.
On the momentum indicator MACD, the MACD line has crossed the signal line, indicates bulls charge over the script.
On the directional front, DI+ is trading above DI- indicating a positive trend, whereas ADX trading above DI- indicates strength in the move, confirming the positivity in Endurance Technologies.
Further, buying interest can be observed If it sustains above the Rs 2,000 level, where the next support can be seen at Rs 1,825, and Rs 2400 would work as a resistance mark for the stock.
(Disclaimer: Recommendations, suggestions, views, and opinions given by experts are their own. These do not represent the views of the Economic Times)