Pullback formation may continue

Mumbai, Sep 01

Today, the benchmark indices bounced back sharply, with the Sensex up by 555 points.

Among sectors, almost all the major sectoral indices traded in positive territory, but the Capital Market and Auto indices outperformed, Capital Market 3.30, Auto up by 2.75 per cent.

Technically, after a muted open, the market maintained positive momentum throughout the day. On intraday charts, it formed a reversal pattern, and on daily charts, it created a bullish candle, indicating a continuation of the pullback formation in the near future.

“For traders now, as long as the market trades above 80,000, the pullback formation is likely to continue,” says Shrikant Chouhan, Head - Equity Research, Kotak Securities.

On the higher side, it could bounce back to the 20-day SMA (Simple Moving Average) or 80,500. Further upside may also continue, potentially lifting the market up to 80,800. On the flip side, if the market falls below 80,000, traders may prefer to exit their long positions.

Stock Picks

IXIGO – Buy | CMP: ₹297.45 | SL: ₹288 | Target: ₹310 / ₹318

IXIGO is showing strong bullish momentum, sustaining above its short-term moving averages with rising volumes. The stock has formed a higher base near ₹290, indicating healthy accumulation. RSI is trending upward, reflecting renewed strength. If it sustains above ₹297, it could trigger a fresh breakout toward ₹310 initially and further to ₹318. Any dip towards ₹292–295 levels can be used as a buying opportunity with a strict stop loss at ₹288.

RITES – Buy | CMP: ₹258.00 | SL: ₹250 | Target: ₹270 / ₹278

RITES is consolidating after a steady uptrend, holding firm above its immediate support zone near ₹252. The stock is trading above key moving averages, showing strength in price action. Momentum indicators suggest a positive bias, with RSI indicating room for an upside move. Sustaining above ₹258 can attract further buying interest, paving the way for levels of ₹270 and ₹278. Traders should maintain a stop loss at ₹250 and accumulate on dips for better risk-reward.

(Source_Riyank Arora Technical Analyst at Mehta Equities)

EoM.