The momentum indicator signalled bullish crossovers — a sign of bullish undertone — on these counters, hinting at possible upsides in the days ahead. Some of the stocks have climbed up to 20 per cent in Tuesday’s session so far.
The list included
, , Bajaj Consumer Care, , , Mphasis, Kansai Nerolac, and L&T Infotech.
ETMarkets.comThe list includes Bajaj Consumer Care, Just Dial, Mphasis and Sobha.
At 1 pm, TCS was up 1.18 per cent at Rs 3,118. ONGC rose 1.95 per cent to Rs 115.20 and Bajaj Consumer advanced 3.10 per cent to Rs 288 on BSE. Mphasis, Sobha, L&T Infotech and Kansai Nerolac Paints rose up to 2 per cent.
Some of the other stocks showing positive trend such as Raj Television Network, AXISCADES Technologies and Onward Technologies were up 10-20 per cent.
The MACD is known for signalling trend reversals in traded securities or indices. It is the difference between the 26-day and 12-day exponential moving averages. A nine-day exponential moving average, called the ‘signal line’, is plotted on top of the MACD to indicate ‘buy’ or ‘sell’ opportunities.
When the MACD crosses above the signal line, it gives a bullish signal, indicating that the price of the security may see an upward movement and vice versa.
ETMarkets.comLupin, Himadri Speciality and Dalmia Bharat Sugar are among 33 stocks showing bearish trends.
Data showed 33 stocks are showing bearish trends. They included , Bharat Forge, Lupin, Magna Fincorp, Himadri Speciality, Coforge and .
The MACD indicator should not be seen in isolation, as it may not be sufficient to take a trading call, just the way a fundamental analyst cannot give a ‘buy’ or ‘sell’ recommendation using a single valuation ratio.
This is because MACD is a trend-following indicator. Though traders can increase the sensitivity of MACD by using shorter moving averages for computing MACD (e.g. 5-day and 12-day moving averages), the lag effect will still be there. Hence, traders should make use of other indicators such as Relative Strength Index (RSI), Bollinger Bands, Fibonacci Series, candlestick patterns and Stochastic to confirm an emerging trend.
On Tuesday, Nifty50 came close to the 15,300 level and was later trading around the 15,250 level.
“The overall structure suggests Nifty is on course to test the high of 15,431. On the downside, the 15,000-14,900 range will now act as a crucial short-term support,” said Gaurav Ratnaparkhi, Head of Technical Research at Sharekhan. He believes any dip towards 15,100 can be used as a fresh buying opportunity.
Understanding MACD
ETMarkets.comHere’s how the ONGC chart looks like.
A close look at the stock chart of TCS shows whenever the MACD line has breached above the signal line, the stock has shown an uptrend and vice versa.
