Technical stocks to watch out for on Monday

BF Utilities Ltd: Considering the weekly timeframe, the stock has given a neckline breakout of Adam & Adam double bottom pattern as on the weekend of June 05, 2020. Thereafter, the stock has witnessed nearly 52 per cent pullback rally. Currently, the stock has given a downward sloping trendline breakout on the daily timeframe, formed by connecting swing highs from July 2020. This breakout is confirmed by the above 50-day average volume. Additionally, the stock has formed an opening bullish Marubozu candlestick pattern on the breakout day, which indicates extreme bullishness. Talking about the indicators, the stock's relative strength index (RSI) is in a rising trajectory in both the weekly and the daily timeframe. The daily stochastic oscillator is suggesting some bullish strength as well since per cent K is above the per cent D. Further, the daily MACD stays bullish as it is trading above its zero line and signal line. Considering all the above factors, we expect the bias to remain positive as long as the stock sustains above Friday’s low of Rs 248.10 level. On the higher side, the level of Rs 278, followed by Rs 300, would be seen as the next resistance zone for the stock.

ESAB India Ltd: After registering the high of Rs 1,645 as on June 09, 2020, the stock has entered into a corrective phase. The correction is halted near the 50 per cent Fibonacci retracement level of its prior upward move and coincides with a 100-day EMA level. During this corrective to sideways phase, the volume is mostly below the 50-day averages volumes, which suggest that it is just routing decline after a robust move (Rs 1,020-Rs 1,645). On Friday, the stock has given a 50-trading session consolidation breakout. Along with this consolidation breakout, the stock has also managed to close above the upper Bollinger band and started the band walk, which is a very bullish sign. The stock is meeting Daryl Guppy’s multiple moving averages set up rules as it is trading above both the short and long-term moving averages. Interestingly, the daily RSI has given an ascending triangle breakout, which is also a bullish sign. The trend strength indicator, average directional index (ADX), is above 25 mark, which indicates the strength of the trend. The +DI is much above the -DI. This structure is indicative of the bullish strength in the stock. Hence, we expect the bias to remain positive as long as the stock sustains above its 20-day EMA level, which is currently placed at 1381.80 level.

Firstsource Solutions Ltd: The stock has formed a reversal Hammer candlestick pattern as on March 24, 2020, and thereafter, marked the sequence of higher tops and higher bottoms. The stock has relatively outperformed the frontline indices in the current leg of the upward rally. Also, the stock relatively outshined Nifty 500 with a decent margin. Relative strength comparison with Nifty 500 and Nifty 50 has reached to new heights. Currently, the stock has given a horizontal trendline breakout on the daily timeframe. This breakout is confirmed by robust volumes. As the stock is near to its 52-week high, it is trading above all the short and long-term moving averages. The stock is meeting the criteria of Mark Minervini’s trend template. The current stock price is above both 150-day (30-weeks) and 200-day (40-weeks) moving average price lines. Moreover, the 30 and 40-weekly averages are trending up and at the same time, they are in the desired sequence. The 14-period RSI on the daily timeframe is in bullish territory. Furthermore, in the recent sideways phase, the RSI never breached its 60 mark, which indicates that the stock is in a super bullish range as per RSI range shift rules. Technically, all the factors are currently aligned in support of the bulls. Hence, we would advise the traders to be with a bullish bias. On the downside, an important support for the stock is placed at the zone of Rs 55-54.70 and on the upside; an immediate resistance is seen at Rs 63.60 level.

Gillette India Ltd: Considering the daily timeframe, the stock gave a symmetrical triangle breakout on Friday. Additionally, the stock formed a sizeable bullish candle on the breakout day, which adds strength to the breakout. Since the last five trading sessions, the volume is above the 50-day average, which is a sign of accumulation. The RSI on the daily chart has moved above its recent swing high and has marked a fresh 14-period high, which is bullish. The daily MACD stays bullish as it is trading above its zero line and signal line. Hence, we would advise the traders to be with a bullish bias. On the downside, the 100-day EMA is likely to act as important support, which is currently placed at 5,186 level. On the upside, immediate resistance is seen at Rs 5,559 level.