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Polycab, Astral Poly Technik: How to trade construction-related stocks

Construction related stocks
Union Budget 2020-21 put forth an array of proposals that are likely to give a fillip to construction-related stocks such as cables, pipes, among others. Focus on agriculture, "Jal Jeevan Mission" for which the government has approved a budgetary allocation of Rs 11,500 crore and "Affordable Housing" are expected to boost these companies in the coming days. 

Here's a look what technical charts indicate for these stocks and how you should trade them -

Polycab India Ltd (POLYCAB): The counter is witnessing selling pressure above Rs 1,100 levels. Although it witnessed strong closing above the same, hitting a high of  Rs 1,140, it failed to hold the upward bias. On the flip side, the Rs 950 level has stood strong in creating buying momentum on every possible correction witnessed thereafter. That said, a bigger perspective reflects a breakout above Rs 1,200 levels and breakdown below Rs 940 levels may determine the next trend. CLICK HERE FOR THE CHART

Finolex Cables Ltd (FINCABLES): The weekly chart suggests a formation of "Double Bottom" pattern with a breakout. That said, the low volumes and the upside resistance in the range of Rs 430 – Rs 435, as per the daily chart has ceased the upward rally. As this counter has taken multiple supports around Rs 345 levels, any correction around this may see strong buying opportunities. Although, the upside seems capped around Rs 435, the breakout momentum exhibits positive sentiment with Moving Average Convergence Divergence (MACD) rising above the zero line. CLICK HERE FOR THE CHART

 

Astral Poly Technik Ltd (ASTRAL): The past one year has not seen this counter falling decisively below 200-day moving average (DMA) and 50-weekly moving average (WMA). The larger perspective reflects “Higher high, Higher low” formation that may only end if the recent reversal low of Rs 1,050 gets broken. The trend remains positive with inclination towards Rs 1,350 levels as the counter breaks trend line resistance of Rs 1,210 levels. The sign of weakness may arise if this counter closes below Rs 1,200 levels for two sessions. CLICK HERE FOR THE CHART

 

Supreme Industries Ltd (SUPREMEIND): Whenever this counter has approached near Rs 1,400 levels, it has seen profit-booking as per the weekly chart. Now, the current crossover of 100-DMA with 50-WMA may manage to absorb all the selling pressure and rally towards Rs 1,520 levels. The support remains at Rs 1,270 levels. CLICK HERE FOR THE CHART



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