Technical stocks to watch out for on Wednesday

Aegis Logistics Ltd: The stock has formed a reversal ‘three inside up candlestick pattern’ as on July 06, 2020, and thereafter, it has witnessed a consolidation. On Tuesday, the stock has given an 11-day consolidation breakout along with strong volumes. The stock's relative strength index (RSI) has reached its highest value in the last 14-days, which is bullish. Also, it has managed to close above the 60 mark after a span of almost 20 trading sessions. Further, the stock is trading above its long and short-term moving averages. Going ahead, we expect the stock to continue its positive momentum as long as it sustains above Tuesday’s low of Rs 190.10 level. On the higher side, the level of Rs 203.40, followed by Rs 212 would be seen as the next resistance zone for the stock.

Allcargo Logistics Ltd: After registering a high of Rs 100.95, the stock has witnessed a minor correction. The correction is halted in between 38.2 per cent and 50 per cent Fibonacci retracement level of its prior upward move (Rs 78-Rs 100.95) and coincides with a 13-day EMA level. On Tuesday, the stock has formed ‘opening bullish Marubozu candle’, which indicates an extreme bullishness. Further, since the last two trading sessions, the volume is above the 50-day average, which is a sign of accumulation. The 14-period RSI on the daily timeframe has given a positive crossover and it is in bullish territory. Furthermore, in the recent sideways to corrective mode, the RSI never breached its 60 mark, which indicates that the stock is in a super bullish range as per RSI range shift rules. In case, the stock sustains above Tuesday’s high then, it would invite further buying and it may test its recent high of Rs 100.95. On the downside, Tuesday’s low of Rs 93.25 is likely to act as strong support.

Bajaj Finance Ltd: Considering the daily timeframe, the stock has formed a reversal ‘bearish engulfing candlestick pattern’, which suggests correction before another northward rally. Among the momentum indicators, the 14-period daily RSI has cooled off after touching the 70 zone and at present, its reading is 61.39. The RSI is trading below its nine-day average and it is in a falling mode, which indicates a further downside momentum. Moreover, a negative divergence was also spotted at the daily time frame on the 14-period RSI. A negative divergence occurs when the price is making a higher high, while the RSI forms lower high. Going ahead, if the stock sustains below Tuesday’s session low of Rs 3,218.65 and trades convincingly below this level then, there is a high probability that Tuesday’s high point of Rs 3,519.50 may become a temporary top for the stock.

JB Chemicals & Pharmaceuticals Ltd: Considering the daily timeframe, since the last 11 trading sessions, the stock is trading in a contracting consolidation. On Tuesday, the price action formed an NR7 with an inside bar. This formation is an interesting set-up that indicates range contraction or a period of rest and Toby Crabel states that after a period of rest or range contraction, a trend day will often follow. Going ahead, the important levels to watch out would be Rs 725 on the higher side and Rs 705 on the downside. A break on either side would open doors for a directional move.

Minda Industries Ltd: Considering the daily timeframe, the stock has been trading in a consolidation phase since the last 10 trading sessions and has mostly formed indecisive candles. Currently, the stock is trading above its short and long-term moving averages. The leading indicator, RSI, is currently quoting at 62.34 and it’s trading above its nine-day average. The initial resistance and parallel highs are placed at Rs 314.10. The 200-day EMA is currently placed at Rs 314.95 level. In case, the stock is able to clear all these resistances, it will gain a bullish strength.

VIP Industries: Considering the daily timeframe, the stock has given a symmetrical triangle breakout. This breakout is confirmed by robust volume. With this symmetrical triangle breakout, the ADX, which shows the strength of the trend, turned upside and moved above the -DI. Further, the leading indicator, 14-period RSI, is in a rising trajectory on both the weekly and the daily timeframe. Going ahead, we expect the bias to remain positive as long as the stock sustains above Tuesday’s low of Rs 267.55 level.