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Energy Index makes all time highs and some more stocks which are making very interesting patterns

The headline Nifty Index has been making new all time highs and we have several sectoral indexes as well that are seeing new breakouts which very important long term consequences. One such Index is the Energy Index. The chart below shows the index.


The constituent of the Index are as follows


Adani Green Energy Ltd.

Bharat Petroleum Corporation Ltd.

GAIL (India) Ltd.

Hindustan Petroleum Corporation Ltd.

Indian Oil Corporation Ltd.

NTPC Ltd.

Oil & Natural Gas Corporation Ltd.

Power Grid Corporation of India Ltd.

Reliance Industries Ltd.

Tata Power Co. Ltd.


Now among all the stocks the Reliance industries has actually not been doing too well. Yet we have the index performing exceedingly well. The charts of the constituent stocks are even more interesting with several of them breaking out after making a bottoming out patten, like the IOC. The other stocks like Power grid and NTPC are also looking good. They are also benefiting from what looks like the markets' fascination with the public sector stocks over the last few weeks or so. Clearly a breakout in the index and the constituent stocks from such a long range is an event that has to be monitored closely and it might set some of these stocks on the journey of a multi-year bull market.


IOC Chart


Hindpetro




 

Apart from the energy stocks we have another stock today which is breaking out from a consolidation on the charts and sustaining above the long breakout level. The stock is Globus Spirit.


Globus Spirits


As is explained in the chart above we have the stock consolidating sideways in the channel on low volumes and we see a breakout in the direction of the prior trend on high volumes. The stock looks to be taking a breather here and we could get a rally in the stock anytime in the near future. Technically speaking the stop loss in the stock can be placed below the upper bound of the channel. With the stock also trading at all time highs we have clear blue skies around and that means the stock has also has a lot of room to run up. Typically instead of a target in these kind of stocks it is better to have a trailing stop loss which enables us to maximise the returns and try and capture whatever we can of the up-move.



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