Shabbir Kayyumi at Narnolia Financial Advisors expects Nifty to trade sideways between 10,680 on the lower side and 11,000 on the higher side in coming sessions.
Narnolia Financial Advisors
A sideways to positive momentum is indicated by the relative strength index (RSI) as it sustains above the 50 mark. The Nifty VIX continues to trade in a of 13.94 and 12.02 range, suggesting that market participants are not seeing a major rise in volatility at least for the Nifty.
Recent major resistance around 10,850 levels and support near 10,600 levels shows a tight trading range of 10,850 to 10,600 levels. The Nifty closing above its 20-day daily moving average (10,756) shows strength and a positive tone.
Derivatives data suggest an immediate trading range between 10,600 and 11,000 levels as highest put open interest is seen around 10,600, followed by 10,500, and highest call OI is seen around 10,800 levels, followed by 11,000.
Based on the last 15 years analysis, the Nifty has gone and touched the highs of June 88 percent of the times. The same stands at 10,891 in the current scenario.
We expect the index to move sideways between 10,680 on the lower side and 11,000 on the higher side in coming sessions. If it closes below 10,600 levels, it could correct to 10,450 levels.
Sustainability of the Bank Nifty above 26,600 levels would result in it heading higher to levels of 26,900-27,200. However, resistance is seen around 26,800, followed by 27,000. Support for the index lies at 26,400, followed by 26,200 levels.
Top 5 stocks that can deliver up to 10 percent in the short-term
Yes Bank: BUY | Buy Range: Rs 345-Rs 350|Target Rs 385| Stop Loss Rs 327| Upside 10%
Yes Bank has witnessed a decent correction recently from the peak of 382 and now it has shown indication for the formation of Inverse H&S pattern where construction of right shoulder is under progress. RSI has found support near 40 mark and has indicated a reversal to maintain a positive bias and has potential to rise further in the coming days. Stochastic is also looking firm lending support to price action. With the chart looking attractive and decent volume participation witnessed, we recommend a buy on dip around 345-350 in this stock for an upside target of 385, keeping a stop loss of 327.
Maruti Suzuki: BUY | Buy Range: Rs 9250-Rs 9300| Target Rs 9,995 | Stop Loss Rs 9,050| Upside 7%
Maruti Suzuki has given falling channel breakout after giving short term consolidation on daily chart. From last few days, it has been trading above from all its important moving averages which is showing further impetus on upside. On weekly chart, long bull candle suggests further bullishness in coming sessions. Moreover, RSI has given trend line breakout and it is also sustaining above 9 days EMA which all giving cues for upside momentum in coming sessions. By looking all these factors, trader and investor can buy this scrip around 9300 keeping stop loss of 9050 for the target of 9995 levels.
ITC: BUY | Buy Range: Rs 268-Rs 270|Target Rs 298| Stop Loss Rs 256| Upside 10%
ITC after hitting the peak of 290, stock slipped below its 200 DMA and it has reversed upside forming congestion zone on lower levels. As of now, it has given falling wedge breakout and started consolidated above 200 DMA which is showing stability in the stock. Positive crossover in MACD along with declining histogram above central line is creating optimism in coming sessions. Sustainability of RSI near 57 mark also providing strength. As long as it sustains above 254, possibility of moving on upside is higher and it can hit our first target of 288 and second target is 298 with an ease.
Godrej Agrovet: BUY | Buy Range: Rs 605-Rs 608|Target Rs 670| Stop Loss Rs 586| Upside 10%
Occurrence of double bottom formation on lower time frame & having positive divergence in RSI, shows limited downside and possibility of reversal in coming sessions. Godrej Agrovet is trading near it’s demand zone 590-610, projecting demand overruling supply ahead. Majority of the oscillators are trading in oversold zone too, expecting some pull back rally. Prices have taken support from strong trendline (touching points 529-567), anticipating turned back from current levels. Looking all technical factors, it should trade with positive tone and we expect Godrej Agrovet to trade higher in coming week by taking support from 600 levels. We suggest accumulating this stock around 605 levels, keeping stop loss of 586 for the target of 650/670.
Hero MotoCorp: BUY | Buy Range: Rs 3550-Rs 3600|Target Rs 3950| Stop Loss Rs 3439| Upside 10%
Hero Motocorp is trading sideways in range of 3400 and 3800 levels since start of Jan 2018. Recently it took support from it’s lower support at 3400 and trading higher. Yesterday it formed strong big green candle on daily charts, suggest bullishness in coming sessions. It has also closed above it’s important moving averages ( 20 DMA/50 DMA/ 100 DMA), indicates further thrust upside. RSI and Stochastic momentum oscillators are trading above 50 levels, implies bullish tone. We expect Hero Motocorp to trade higher in coming week by taking support from 3550 levels. However, we suggest accumulating this stock in dip around 3550-3600 levels, keeping stop loss of 3439 for the target of 3950.Disclaimer: The author is Head – Technical and Derivative Research at Narnolia Financial Advisors. The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.