Market Trading: 5 Stocks to Watch Today Based on Technical Breakouts

The Indian equity market on Wednesday continued its winning streak, for the third day in a row, propelled by a rally in the BFSI and FMCG sectors. The BSE Sensex surged 309.40 points to close at 77,044.29, while the Nifty increased with more ease, tacking on 108.65 points to settle at 23,437.20. 

According to technical analysts, the Nifty managed to reverse early weakness and close above the 100-day exponential moving average (EMA) for the second consecutive day. Early weakness was reversed, support is near 23,300, and as long as the index holds above this level, the sentiment update is bullish. On the upside, resistance is pegged around 23,650.

Axis Bank: Breakout Signals Bullish Continuation

An emerging trend in Axis Bank has been characterized by strong volume. Traders seem bullish. The stock remains above both the 21-day and 50-day EMAs, evidencing good strength. Technical indicators such as the RSI are retracing upward after a brief pause, and the MACD has very recently shown a bullish crossover. This combination of signals points to higher prices in Axis Bank. Traders might consider going long with a stop-loss under the last swing low and with a reasonable price target of going back to test the all-time highs.

Chola Fin: Cup and Handle Pattern Breakout in Play

Chola Financial Holdings has shown a classic breakout from a Cup and Handle formation, a textbook bullish indicator. The move was confirmed by volume that was better than average, showing strong interest from buyers. At this point, the stock is not only above the 21-day and 50-day EMAs, but it also looks better in terms of upside potential.

RBL Bank, Indian Bank, and IEX: Gaining Traction

RBL Bank shows signs that it is reversing a trend, having formed a base and broken above its 20-day EMA. Also confirming the bullishness and momentum is the RSI, which is forming higher lows. The stock is targeting a price around 194, and an investor could use a stop-loss around 174.

On the other hand, Indian Bank has broken out of a consolidation phase. A strong bullish candle on the daily chart and a sustained position above the key EMAs indicate that there is a potential for upside momentum. A probable move toward INR 598 is on the radar, with key stop loss level acting at INR 545.

Finally, the Indian Energy Exchange (IEX) has broken above a falling trendline and is now trading comfortably above its 20-day EMA. A crossover in the RSI adds to the strength of this setup, which has a tentative price target at INR 196 and a safety net at INR 178.

These stocks have solid technical setups and are ones to keep a close watch on for potential short-term trading opportunities.