Here’s why DLF needs to be on your watchlist!
With the Realty index surging in a weak market, shares of DLF caught investors' attention as it traded higher with huge volumes.
On Monday, the NSE benchmark Nifty50 took over the negative baton from Friday’s weak close at Wall Street on the back of hotter-than-expected US inflation data. As a result, Nifty declined 0.36 per cent.
Talking about the sectoral performance, the majority of the sectors were seen trading in red, while on other hand, four sectors were seen trading in green led by Nifty Realty.
The Nifty Realty index was up by over 2 per cent on Monday. This up-move was seen after a formation of the back-to-back bearish candle on the weekly chart. One of the stocks which caught investors' attention was DLF. The stock is among the top constituents by weightage in Nifty Realty Index with a weight of over 30 per cent.
The stock advanced over 1 per cent on Monday with a total traded volume greater than its prior trading session. If we move to a higher time frame chart, we can observe that the stock has taken support not once but multiple times from the band of Rs 341-346. And not surprisingly, this time was no different as stock once again bounced back after taking support around this band.
But, what’s the road ahead for the stock? Will it give sky-scraping returns or it will be in a dire strait?
Here’s a technical check of DLF
After the pandemic carnage, the stock rallied nearly 293 per cent from its March 2020 lows. At present, the stock has rebounded from its strong support area of Rs 341-347 and interestingly, despite a gap-down opening in the benchmark indices, it did not breach its prior week's low. On the weekly RSI, the stock has not breached the level of 40. But, on the daily chart, it was seen bouncing from the oversold region and witnessed a positive crossover i.e, the RSI has moved above its 9-day exponential average, which bodes well for the stock.
Considering the above factors, contrarian investors and traders can keep this stock on the watchlist.