Best intraday stocks to watch out for on August 19

On Thursday, Nifty recovered almost 100 points from the day’s low and ended the day with modest gains of 0.07%. It tested the previous day's high and formed yet another bullish bar by closing near the day’s high. Meanwhile, Kotak Mahindra Bank and L&T helped the index to recover the morning session losses.

Thursday’s bullish candle has been formed on the back of a higher volume, which indicates that there is renewed buying interest at lower levels i.e. dip. At the same time, the negative index breadth (28 declines) has raised some suspicions about the upmove. Interestingly, except for one sector i.e. Nifty Realty, none of the other sectoral indices gained over a per cent. The RSI closed at an extreme level of 83.84.

For the last four days, the index is in an overbought zone. The MACD histogram has not improved and is still, in a declining phase. On the lower timeframe, the price pattern with parallel highs looks like a double top. Going forward, any decline below 17,850 will confirm the pattern's bearish implications. There are many signs of exhaustion and extension of a rally; however, as long as the price is making higher lows and moving higher, it’s better to be with the trend. That said, one should not be complacent; hence, a strict stop-loss at the prior day’s low is recommended for momentum traders.

 BHEL 

The stock has broken out of an inverted head and shoulders kind of a pattern. It also broke the Stage2 base. The Higher volume indicates that the breakout is valid. It is trading above the key moving averages. It is above the moving average ribbon. It is trading 13.80% above the 50DMA and 5.82% above the 20DMA. The MACD and TSI have given fresh bullish signals. The stock also closed above the 200DMA and Anchored VWAP. The Elder impulse system has formed strong bullish bars. The RSI is in a strong bullish zone. In short, the stock has broken the long consolidation. A move above Rs.56 is positive, and it can test Rs.62 and Rs.66. Maintain a stop loss at Rs.51.

DIXON

The stock has broken out of a 39-day ascending triangle. Higher volume has been recorded for the last two days. The stock is trading above all key moving averages. It is trading 6.33% above the 20DMA and 10.33% above the 50DMA. The RSI is in a strong bullish zone. MACD is above the zero line histogram and shows an increased bullish momentum. The KST and TSI indicators are in the bullish setup. The Elder impulse system has formed strong bullish bars. In short, the stock has broken out of a bullish pattern. A move above Rs.4062 is positive, and it can test Rs.4113. Maintain a stop loss at Rs.4000. Above Rs.4113, it can test Rs.4366.