The Indian equity benchmarks extended their losses on Tuesday, December 16, succumbing to intense selling pressure. Both the Sensex and Nifty 50 indices declined by over 0.6%, hitting fresh intraday lows. The downturn was fueled by a combination of a tumbling rupee and persistent selling activity from foreign institutional investors (FIIs).
Market Under Pressure from Global and Domestic Headwinds
Investors found little respite as domestic catalysts remained absent, forcing the market to take cues from the global environment. Unfortunately, international sentiment offered no support. Renewed anxiety over stretched valuations in the artificial intelligence (AI) sector and escalating geopolitical conflicts worldwide prompted a shift towards safer assets, dampening risk appetite.
Adding to the domestic woes, the Indian rupee breached the psychologically crucial level of 91 against the US dollar, plummeting to a new historic low of 91.07. This relentless depreciation of the currency further eroded investor confidence and contributed to the bearish mood on Dalal Street.
Brokerage Identifies Three Technical Breakout Stocks
Amid the broad market weakness, domestic brokerage firm Axis Securities has pinpointed three stocks that exhibit strong technical breakout patterns. The brokerage believes Vedanta, Ashok Leyland, and ICICI Prudential Life Insurance Company have the potential to deliver significant returns in the short to medium term.
According to their technical analysis, all three scrips have decisively broken above key resistance levels, supported by bullish Relative Strength Index (RSI) readings. Axis Securities forecasts a defined upside over a 3 to 4-week horizon, with target gains ranging from 7% to 13%.
Vedanta: Target Up to ₹603
Axis Securities highlighted that Vedanta (VEDL) has delivered a decisive weekly breakout above a strong multi-resistance zone around ₹527. This breakout was marked by a bullish candle, signaling a positive bias. The stock is trading above all its key moving averages (20, 50, 100, and 200-day SMAs), confirming strong momentum. The brokerage sees an upside towards the ₹576–603 range.
Ashok Leyland: Target Up to ₹180
Ashok Leyland has broken out above a bullish flag pattern at the ₹160 level, according to the analysis. The stock maintains a higher high-low structure, indicating a robust bullish setup. With the daily RSI trending higher, the brokerage has set a price target between ₹175 and ₹180 for the commercial vehicle maker.
ICICI Prudential Life Insurance: Target Up to ₹700
For ICICI Prudential Life, the brokerage noted a decisive breakout above a medium-term downward trendline at ₹645. This move suggests the end of a corrective phase that began from the September 2024 peak. The weekly RSI has also broken its downtrend, reinforcing strength. Axis expects the stock to rise towards the ₹676–700 levels.
Disclaimer: This article is for informational purposes only. The views and recommendations are those of the brokerage firm and not of the publisher. Investors are strongly advised to consult with certified financial experts before making any investment decisions.
