- You may be sitting on a missed upside if you overlook the RSI bullish crossover.
- Holding above the 20‑day moving average keeps the short‑term bias positive.
- Craftsman Automation is trading near ₹8,119 with a 9.4% upside target.
- Laurus Labs shows a potential 12% rebound as it stabilizes around ₹990‑₹1,000.
- Both stocks sit on strong trendlines, offering tactical entry points for disciplined investors.
You’re missing the next Nifty breakout if you ignore today’s technical clues.
Why Nifty’s Flat Close Signals a Bullish Bias
Wednesday’s Nifty ended virtually unchanged, yet the market’s anatomy tells a different story. The index stayed comfortably above the 20‑day moving average (20DMA), a classic sign of short‑term strength. More importantly, the Relative Strength Index (RSI) executed a bullish crossover, moving from the oversold zone toward the 50‑70 range, indicating growing buying momentum. Resistance lingered at the psychologically important 26,000 level; the index tested it but retreated, leaving the key support at 25,800 intact. In technical parlance, a decisive break above 26,000 would likely trigger a cascade of stop‑loss orders on the short side, propelling the market higher. Historically, Nifty has used similar consolidation patterns to set up multi‑month rallies. In early 2022, a flat close near 22,000 preceded a 12% surge after a breakout above 22,500. The pattern repeats: a tight range, bullish RSI, and price above the 20DMA create a fertile ground for a breakout. For investors, the implication is clear: stay alert for a clean close above 26,000. Even a modest close above this level can validate the bullish bias and invite institutional inflows.
What Craftsman Automation’s Trendline Tells You About Momentum
Craftsman Automation (CMN) is perched at ₹8,119, comfortably riding a higher‑high, higher‑low structure that has defined its daily chart for the past six months. The stock sits above a rising long‑term trendline and key moving averages (50‑day and 200‑day), indicating sustained buying pressure. After a brief consolidation between ₹7,600‑₹7,800, the price re‑entered the uptrend, and the RSI now rests at 63—still below the overbought threshold of 70, leaving ample room for upside. The technical setup points to a target range of ₹8,500‑₹8,700, which translates to roughly a 9.4% upside from today’s price. A stop‑loss placed at ₹7,600 respects the recent low and the moving‑average support. In a sector where automation and robotics demand are accelerating—driven by Industry 4.0 initiatives—CMN’s price action mirrors the broader industry tailwinds. Peers such as Tata ELXSI and Adani Power & Infrastructure are also experiencing bullish technical patterns, suggesting that capital is rotating into automation.
How Laurus Labs Is Setting Up for a Potential Reversal
Laurus Labs (LAL) has retreated from its recent high near ₹1,120 and is now consolidating around the ₹980‑₹1,000 band. The stock is hugging its short‑term exponential moving average (EMA) at ₹995, a classic sign of a possible trend reversal. The RSI, hovering at 52, has bounced from lower levels, indicating improving momentum without yet entering overbought territory. A robust bullish candle with higher volume on the last session underscores renewed buying interest at lower prices. The technical narrative suggests a target of ₹1,090‑₹1,120, delivering about a 12% upside from the current level. A prudent stop‑loss around ₹950 protects against a false breakout. In the pharmaceutical arena, where pipeline news and regulatory approvals dominate price moves, Laurus’s technical stabilization offers a contrarian entry point amid sector-wide volatility.
Sector Implications: Automation vs Pharma in a Range‑Bound Market
The broader market’s range‑bound nature is forcing investors to seek alpha in sector‑specific catalysts. Automation stocks like Craftsman benefit from government incentives for smart factories, while pharma names such as Laurus Labs are buoyed by rising demand for generic drugs and specialty APIs. Comparative analysis shows that automation peers have collectively outperformed the Nifty by ~3% year‑to‑date, whereas the pharma index has lagged by ~1.5%. However, both sectors are sensitive to global supply‑chain dynamics and domestic policy shifts. A breakout in Nifty could lift the entire risk‑on sentiment, amplifying the upside potential for both CMN and LAL.
Investor Playbook: Bull and Bear Scenarios
- Bull case: Nifty breaks above 26,000, triggering algorithmic buying; CMN rides the automation rally to ₹8,700; LAL capitalizes on a pharma rebound to ₹1,120. Portfolio allocation: 60% equities, with 25% split between CMN and LAL, 35% in diversified Nifty ETFs.
- Bear case: Nifty stalls below 25,800, prompting risk‑off flows; CMN retraces to its 20‑day MA around ₹7,600, eroding the upside target; LAL falls back to its 50‑day MA near ₹950, triggering stop‑losses. Portfolio mitigation: tighten stop‑losses, shift 30% to defensive sectors like FMCG or utilities.
By monitoring the key technical thresholds and sector dynamics outlined above, you can position your portfolio to capture upside while protecting against downside surprises.