RIL, Dr Reddy's Labs: 5 Nifty500 stocks cross 200-DMA, defying weak trend

Market participants consider stocks, which revive back above 200-day moving average (DMA), as the most risk-averse picks from a short-to-medium term perspective. Recently, the benchmark indices witnessed rout wherein it saw three-day losing streak in the last week, implying a shift in sentiment.

Out of the five sessions in the last week, the BSE Sensex and Nifty closed lower for three sessions consecutively. This affected the reversal sentiment gradually occurred in its previous week.

Nevertheless, Monday's session managed to soften the developing negative aggression, with few Nifty 500 stocks exhibiting rebound back over their key moving averages.

Furthermore, stocks experiencing resilience over any sell-off definitely possess inherit strength, which seems to grow as leading indices follow identical directional trend.  Such stocks usually witness accumulation even in their slightest decline, which for an investment appears to be at better risk. 

Shares of CG Power and Industrial Solutions and Hindustan Zinc on Tuesday surged 2 per cent and 1.51 per cent, respectively, in a dicey market where the benchmark indices saw a cut of 0.70 per cent in the morning deals.  National Aluminium Company rose over 2 per cent after successfully overcoming 200-DMA. Similarly, Dr. Reddy's Laboratories and Reliance Industries witnessed mixed trade on Tuesday morning. 

Here’s the technical outlook for stocks exhibiting positive reversal in a volatile markets:-

Dr. Reddy's Laboratories Limited (DRREDDY)

Likely target: Rs 4,550 and Rs 4,800

Upside potential:  5% and 11%

While shares of Dr. Reddy's Laboratories reflect a frail trend, the selling pressure is unable to heavily drag the stock price beneath the 200-day moving average (DMA) support. This sentiment indicates a positive bias underlying the support marks. Now, when the counter has risen over the 200-DMA set at Rs 4,294-mark, the price action reflects an upward rally in the direction of Rs 4,550. If the momentum sustain, the stock could see further levels of Rs 4,800. CLICK HERE FOR THE CHART

Reliance Industries Ltd (RELIANCE)

Likely target: Rs 2,700 to Rs 2.800

Upside potential:  8%

Following a strong close over the 200-DMA set at Rs 2,559, the chart structure of Reliance Industries reveals a “Double Bottom” breakout. This robust move signals an up move in the direction of Rs 2,700 to Rs 2.800 levels.  If this breakout holds, the medium-term outlook for Reliance Industries could see accumulation on every healthy correction.  CLICK HERE FOR THE CHART

National Aluminium Company Limited (NATIONALUM)

Likely target: Rs 100

Upside potential:  17%

National Aluminium Company has broken through the barrier of 200-DMA, after deeply struggling since May 2022. The trend has now turned in the favour of bulls, and the counter is likely to perceive a short-to-medium term upside in the coming sessions. The candlestick patterns advocate a positive move towards Rs 100 levels. The cushion that has been bolstering the upward bias stays at Rs 80-mark.  CLICK HERE FOR THE CHART

CG Power and Industrial Solutions Ltd (CGPOWER)

Likely target: Rs 340

Upside potential:  15%

When the overall broad market experienced sell-off in late last week, shares of CG Power and Industrial Solutions were witnessing accumulations around Rs 270 levels. Following this, the stock went to hit a new historic peak, with strong volumes signalling fresh upside on cards.  Thus, until the support of Rs 275 is defended on the closing basis, the breakout structure could see Rs 340 in the coming sessions. CLICK HERE FOR THE CHART

Hindustan Zinc Ltd (HINDZINC)

Likely target: Rs 380

Upside potential:  10%

The stock is gradually rising upward, with the formation of “Higher high, Higher Low” and has not had any significant decline in the recent rout. With the support of Rs 330, the stock is anticipated to rally in the direction of Rs 380 levels. CLICK HERE FOR THE CHART