Short term Sector Momentum Stock Picks - Allahabad Bank, Adani Power :: HDFC Sec, link

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Current Observation:
 The PSU Banking sector has witnessed a sharp decline during today’s weak broader market and the Allahabad Bank
is one of the stocks which contributed to the sectors decline.
 Daily timeframe chart of Allahabad Bank (ALBK) is indicating a sharp decline in today’s session and the stock price
has engulfed the previous three session’s small rise, resulting in formation of negative candlestick pattern of ‘bearish
engulfing’. This could be a near term top reversal pattern for the stock price.
 We observe a negative sequence formation of larger lower tops and bottoms over the last 5-6 months and the stock
price has now reached the strong valuation resistance of around Rs.126 (brown horizontal line). Hence one may
expect the possible formation of new lower bottom here around Rs.124 levels and beginning of fresh declines.
 Daily momentum oscillator like 14 period RSI has turned down from the key upper area of 60 levels signaling the
strengthening of downside momentum.
 Chart pattern and momentum are suggesting a weak bias for ALBK for near term.

Current Observation:

 Attached daily timeframe chart of the energy stock Adani Power Ltd has been showing an intermediate declining 

trend in the sequence of lower tops and bottoms in the last 5-6 month. Currently the stock price has made a new 

lower top around Rs.48.50.

 The strong resistance of 50 day EMA (blue curvy line) is continuously offering resistance of the falling prices and we 

see the stock price tumbled after moving above the hurdle of this moving average around Rs.47.60 levels.

 Today’s sharp decline in the stock price could be a formation of variation type of ‘evening star’, which is suggesting a 

possible short term top reversal pattern. Hence one may expect continuation of decline in the stock price for near 

term.

 The daily RSI, which was moving within a bearish high low range of around 60-30/25 levels seems to have 

completed its upward journey. After hitting the upper bearish range of 60 levels during early part of this month, one 

may expect it to slide lower to the 40 levels and below. This expected pattern of daily RSI could be in line with the 

further underperformance of the stock price.

 Negative overall chart setup is showing an opportunity for fresh selling in Adani Power for near term.

LINK

http://www.hdfcsec.com/Share-Market-Research/Research-Details/StockReports/3009934