Chemicals Under Spotlight

March 30, 2021

The market has been moving sideways for two months now. But that does not mean that every sector will reflect the same move.

As the story of a market cycle unfolds, various sectors assume importance just like different characters in a play. Currently, the Chemicals segment is in the spotlight so let's see what its constituents are up to!

The Chemicals segment has been showing strength over the past few days with some interesting setups lined up. We included one such setup in our Trade of the Week post.

First up, we have Pidilite Industries which is now moving back into positive territory as it inches towards its overhead resistance at 1,800. The price has consolidated in the range of 1700-1820 and looks ready for a breakout as the indicator attempts to move higher. With the overall sector in focus, Pidilite could be dolling up to participate in the next leg of the rally.

We are bullish above the risk management level of 1,820 with a target near 2,030.

Click on chart to enlarge view.

Next, let's take a look at a name that has ripped through its earlier resistances and is on the way to its next target. Linde India has been breaking out above its resistances with ease and the indicator continues to trade in the bullish momentum territory making this ripe for the next bullish move.

Pullbacks towards 1,495 can be used as buying opportunities with a target near 2,170.

Galaxy Surfactants has been making slow and steady progress as the price continues to trade above its breakout level of 2,290 and the indicator hovers around the positive zone. As can be seen in the past, this is one stock where a breakout is followed by a consistent but steady move rather than a ripper.

We are bullish above the risk management level of 2,290, with a target near 3,170.

GNFC is another name that has displayed strength in price as well as the indicator. Although the price has only recently broken out of a two-year base, there is a long way up as the follow-through of the move plays out. The price has formed what is called a bullish Flag and looks good for a move towards the next overhead supply zone.

GNFC is positive above the level of 268 with a target near 375.

Alkyl Amine is the next character to watch out for. The price has been holding above its crucial resistance of 4,987 with the indicator maintaining a strong grip on the bullish momentum. One of the strongest names in this sector, Alkyl Amines is bullish above the level of 4,987 with a target near 7,730.

Aarti Industries is on our radar. The price is taking another go at its resistance of 1,320 and the tailwinds supporting the chemicals group could just push the price beyond the overhead supply.

We are bullish only if the price breaks out above the level of 1,320, with a target near 1,723.