Volatility picks up in the final stages of the February F&O series expiry as the Nifty oscillates within the 10,960-10,730 range amid escalating Indo-Pak tensions. Nifty revisited its 200- DEMA (double exponential moving average) yet again, only to find support which helped it pull itself back above 10,800. This oscillation mode could continue within the range of 10,930-10,730, while only a sustained move above 10,960 could see a move towards 11,100. Any decline below 10,700 from here on could be detrimental for the ongoing momentum as it would mark an end of bullish momentum. With consolidation resistance almost tested, as expected, the next set of aggressive longs will be built post a breakout above 10,960, while the overall trend stop remains firm below 10,530.
Stock: AXIS BANK
CMP: Rs 718.20
Axis continues to be in a strong bullish trend as price reclaimed the position above its 20-DEMA. The occurrence of a “Bullish Belt Hold” candleline on February 26, followed by a gap up opening reaffirms the underlying strength. The sustenance of daily RSI (relative strength index) above its signal line without any relative divergence against price suggests further room for oscillator prior to any overbought signs are witnessed. Traders should continue to build longs with a stop below Rs 693 “Belt Hold” lows for an immediate upmove towards Rs 740, followed by Rs 756.
Stock: INDIGO (InterGlobe Aviation)
CMP: Rs 1,112.30
Indigo's stock is moving lower after an unsuccessful attempt to breach previous highs attained on December 28, 2018, in turn forming “Double Top” around Rs 1,200 levels. It once again made an unsuccessful attempt to breach its 20-EMA (exponential moving average) and closed below its 50-EMA placed at Rs 1,122. Pattern analysis indicates the stock is expected to test its previous “Double Bottom” support around Rs 1,050 in coming sessions. Traders should initiate shorts at current levels for test of Rs 1,050 support to be obtained with stop placed above Rs 1,155 levels.
Disclaimer: The analyst may have positions in any or all the stocks mentioned above.