Domestic equity markets were trading higher in early trade with marginal gains on Friday on account of sustained foreign inflows. Sensex gained over 50 per cent in the early trade, while Nifty was trading above 8,690. In the present market scenario, Mustafa Nadeem, chief execuive officer, Epic Research gave his technical calls on KRBL and Kaveri Seeds with ‘Buy’ rating. However, Nadeem has ‘Sell’ on IOC.
Technical calls by Epic Research
KRBL: KRBL on weekly chart has formed reversal pattern , hammer, which indicates a short term pullback on charts with 50 Days SMA as well. The stock is showing strength in its relative strength index (RSI) and we expect this to be a new higher bottom and retrace to higher side of Rs 280 with stop loss at Rs 225.
Indian Oil Corporation (IOC): IOC on weekly chart has made a bearish engulfing pattern which indicates reversal on higher side coupled with trendline resistance formed adjoining peaks of last 5 years. The stock RSI signals an overbought zone with bearish divergence and a short term correction cannot be ruled out. Epic expects IOC to correct to Rs 525-489 on closing basis with stop loss at Rs 562.
Kaveri Seed: Kaveri Seed is showing signs of reversal as it has formed a double bottom at Rs 352 levels on weekly chart along with bullish hammer formation. The stock has reversed with higher volumes while a mean reversion to 50 SMA looks evident on charts as well. We expect it to technically bounce back, short covering as well, towards Rs 430 with stop loss at Rs 357.
