Stocks from the metal sector were consolidating after the stellar rally from 5,800 to 6,600 on the Nifty metal index.
The index consolidated over the last couple of weeks between 6,500 to 6,350 and it's breaking out in today's session.
Technically, the breakout of the rectangle pattern is visible on the short-term chart of the metal index.
The 2-hours or 120-minute chart above highlights the breakout on the price as well as the oscillator.
In the lower panel of the chart, the Relative Strength Index (RSI) oscillator, which measures the strength of the trend, is breaking out of its previous multiple highs.
As the index is breaking out and the momentum is likely to head northwards, outperforming stocks in the metal space may continue to head higher.
At the start of April 2022, I recorded a video on the Nifty Metal index and commodity prices, in which I indicated the rally is not yet over.
At present, the Nifty metal index is trading 1.1% higher. From the index, Jindal Steel & Power is leading with 4% gains.
If you're interested in being part of my charting journey as I share how to create wealth from profitable trade setups, join my telegram channel - Fast Profits Daily.
Lithium is the new oil. It is the key component of electric batteries.
There is a huge demand for electric batteries coming from the EV industry, large data centres, telecom companies, railways, power grid companies, and many other places.
So, in the coming years and decades, we could possibly see a sharp rally in the stocks of electric battery making companies.
If you're an investor, then you simply cannot ignore this opportunity.
Details of our SEBI Research Analyst registration are mentioned on our website - www.equitymaster.comDisclaimer: This article is for information purposes only. It is not a stock recommendation and should not be treated as such. Learn more about our recommendation services here...
Brijesh Bhatia Research Analyst and expert chartist, is the editor of Alpha Wave Profits. Fully committed to his craft, Brijesh has mastered the art of making money by trading using technical analysis. Brijesh has an MBA from ICFAI and 16 years of experience in India's financial markets. He began his career on Dalal Street as commodities dealer and it wasn't long before he developed his own unique trading system. Brijesh worked on his trading system until it could be expected to deliver 5 units of return for every unit of risk.
Equitymaster requests your view! Post a comment on "Nifty Metal Index Signals a Breakout. Watch Out for Outperforming Stocks". Click here!
Comments are moderated by Equitymaster, in accordance with the Terms of Use, and may not appear
on this article until they have been reviewed and deemed appropriate for posting.
In the meantime, you may want to share this article with your friends!