VBL, MRPL among top picks of Anand Rathi for July 04; check key levels here
On an hourly scale, MRPL has been showing a consolidation pattern above the 21, 50, 100, and 200-period Exponential Moving Averages (EMA)
 "VBL, MRPL among top picks of Anand Rathi for July 04; check key levels here")
Varun Beverages Limited (VBL)
After peaking near the Rs 1,672-mark on 19-06-2024, VBL experienced a significant downturn, with a decline of approximately 110 points, equating to roughly 6-7 per cent. However, in the current week, VBL demonstrated resilience by avoiding further drops and instead reversed around 21DEMA.
Notably, in the prior trading session, there was notable buying activity observed at lower price levels, suggesting investor interest in purchasing the stock at these levels. From a technical perspective, the daily RSI indicator has given reversed from 55 levels, indicating a potential shift in momentum, and presenting an attractive buying opportunity.
Consequently, traders are advised to consider buying VBL within the range of Rs 1,600-1,615, with an anticipated upside target of Rs 1,685, with a stop-loss placed at Rs 1,560 based on a daily closing price.
Notably, in the prior trading session, there was notable buying activity observed at lower price levels, suggesting investor interest in purchasing the stock at these levels. From a technical perspective, the daily RSI indicator has given reversed from 55 levels, indicating a potential shift in momentum, and presenting an attractive buying opportunity.
Consequently, traders are advised to consider buying VBL within the range of Rs 1,600-1,615, with an anticipated upside target of Rs 1,685, with a stop-loss placed at Rs 1,560 based on a daily closing price.
Mangalore Refinery and Petrochemicals (MRPL)
On an hourly scale, MRPL has been showing a consolidation pattern above the 21, 50, 100, and 200-period Exponential Moving Averages (EMA).
This consolidation indicates that the price is stabilizing at a level higher than these key moving averages, which are often used to identify trends and support levels. Additionally, the Relative Strength Index (RSI) on the hourly chart has consistently remained above the 40 level.
RSI is a momentum oscillator that measures the speed and change of price movements, with values above 40 typically indicating bullish momentum. The combination of these technical indicators suggests that MRPL is likely to experience a breakout in the near future. Based on this analysis, it is advisable to take a long position in MRPL within the price range of Rs 216 to Rs 219.
The target price for this trade is set at Rs 236, while the stop-loss is recommended at Rs 208, to be enforced if the price closes below this level on a daily basis.
This consolidation indicates that the price is stabilizing at a level higher than these key moving averages, which are often used to identify trends and support levels. Additionally, the Relative Strength Index (RSI) on the hourly chart has consistently remained above the 40 level.
RSI is a momentum oscillator that measures the speed and change of price movements, with values above 40 typically indicating bullish momentum. The combination of these technical indicators suggests that MRPL is likely to experience a breakout in the near future. Based on this analysis, it is advisable to take a long position in MRPL within the price range of Rs 216 to Rs 219.
The target price for this trade is set at Rs 236, while the stop-loss is recommended at Rs 208, to be enforced if the price closes below this level on a daily basis.
Apollo Hospitals
Recently, Apollo Hospitals has shown a bullish divergence on the 1-hour chart, indicating a potential reversal from a downtrend to an uptrend. This divergence is accompanied by the price action rising above the 21-period Simple Moving Average (SMA), which further strengthens the signal of a trend change.
A bullish divergence occurs when the price forms lower lows, but the underlying indicator (like the Relative Strength Index or RSI) forms higher lows, suggesting that the downward momentum is weakening, and a reversal may be imminent. On the daily chart, Apollo Hospitals has formed a double bottom pattern at the 200-day Exponential Moving Average (DEMA), which is considered a strong support level.
A double bottom pattern is a bullish reversal pattern that typically signals the end of a downtrend and the start of an upward move. The 200 DEMA serves as a significant support level, adding credibility to the potential for a trend reversal. Given these technical signals, it is suggested to buy Apollo Hospitals in the range of Rs 6,150 to 6,200. The target for this trade would be Rs 6,500, representing a potential upside. To manage risk, a stop-loss should be placed near Rs 6,010 on a daily closing basis.
(Jigar S. Patel is a senior manager of equity research at Anand Rathi. Views expressed are his own.)