Weekly Stock Breakouts 29th July 2022

Technical charts give a sense of what is the likely future direction of any stock. The charts are assumed to capture the news and events and factor these in the price. One of the most common ways of identifying stocks with potential upside is interpreting charts and identifying the trends and price movements. Growing volumes with stock price breakouts indicate greater investor interest and signs of further upward movement in the short to midterm.

This week saw the Nifty 50 close 2.62% higher than the previous week. The month of July saw the Nifty closing 8.60% higher than June, which is the best performance of Nifty 50 in this calendar year.

Many stocks have resumed their upward journey along with the Nifty 50 and have risen by a few percent this week. Some of these stocks gave a price volume stock breakout with a potential to head higher in the next few weeks. Based on a propriety analytics, we have identified stocks that have given favorable  stock breakouts on the week ending 29^th July 2022.

 

Sr No	Date	Company	CMP 29 July 2022	Target	Time
1	29-Jul-22	Bajaj Finance	7209	8075	4-5 weeks
2	29-Jul-22	Bata India	1961.6	2095	4-5 weeks
3	29-Jul-22	Navin Fluorine	4383	4820	4-5 weeks
4	29-Jul-22	SBI Life	1294.9	1400.0	4-5 weeks

 

Bajaj Finance

Sector: NBFC (Non Banking Financial Company)

Bajaj Finance is a financial services company engaged in the business of consumer finance, housing finance, auto loans, SME lending etc.

Customer acquisitions and new loans trajectory have been strong and the momentum will only get stronger from here on with the digital ecosystem – app, web platform and the full-stack payment offerings. The company is focusing on a complete digital infrastructure to enable complete set of services via a seamless digital transactions.

The stock has broken out its long-term resistance line and this also marks a confirmation of the trend changing. It is very less likely that the stock would retrace to the previous low of the downtrend. The stock can be expected to cross levels of 8000 in next few weeks.

Bata India

Sector: Footwear

Bata India is the largest retailer and leading manufacturer of footwear in India with more than 1,800 retail stores across the country.

Despite COVID-19 lockdown restrictions impacting formal and fashion footwear sales considerably for Bata India, it resorted to aggressive store openings in FY22. Bata opened 23 and 78 franchisee stores in tier 3–5 cities in Q4FY22 and FY22 respectively taking the total to 303 stores. The company would maintain its stance of aggressive store openings as it has guided to reach 500 franchisee stores in the next two to three years.

The stock has broken out of its long term resistance line and is likely to head higher over the next few weeks to levels of 2100.

Navin Fluorine

Sector: Commodity Chemicals

Navin Fluorine is a manufacturer of chemicals with different verticals, including refrigerants, inorganic fluorides, and other speciality chemicals.

Navin Fluorine has recently entered into a  $410 million contract with Honeywell International Inc. for manufacture and supply of a High-Performance Product (HPP) in the fluorochemical space.

The stock breaks out of its ten-month consolidation with 8.5 X higher volumes on the stocks breakout. It is interesting to note that the stock was in a continuous uptrend for two years prior to the consolidation period. Such types of stocks are great long term wealth creators if held for a period of few years.

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SBI Life

Sector: Life Insurance

SBI Life Insurance Company is India’s second largest life insurance company after the state-owned behemoth, LIC of India. It benefits in its distribution strategy due to the banking channel of SBI.

During the pandemic, customer awareness of life insurance grew which will eventually benefit life insurance companies. These companies also had more than usual claims during the pandemic leading to a drop in profitability. However, with situation changing and the pandemic behind us, life insurance companies are expected to do well in FY23.

The stock has broken its resistance level at 1250 after nearly a year with 3.9 X volumes on stocks breakout. It could head to levels of 1400 over the next few weeks.

 

About the Author

Ketan Sonalkar (SEBI Rgn No INA000011255)

Ketan Sonalkar is a certified SEBI registered investment advisor and head of research at Univest. He is one of the finest financial trainers, with a track record of having trained more than 2000 people in offline and online models. He serves as a consultant advisor to leading fintech and financial data firms. He has over 15 years of working experience in the finance field. He runs Advisory Services for Direct Equities and Personal Finance Transformation.

Note – This channel is for educational and training purpose only & any stock mentioned here should not be taken as a tip/recommendation/advice

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