Jaydeb Dey Stewart & Mackertich Wealth Management
The Nifty ended 0.53 percent up at 10,184.15. Day long oscillation within 10,210 to 10,140 led to a Doji candle on the daily chart. Doji implies indecision among traders. Hence, Nifty getting stuck in the price band of 10,230 to 10,140 is likely.
However, stock specific movements might get you a desired result compared to the Index based ones. As the chart pattern suggests, Nifty still remains a buy on dips as long as critical supports are intact. Downside supports are now placed around 10,140 and 10,080.
On the Nifty hourly chart; it touched the 100 hourly EMA placed around 10,210. Position of RSI suggests, it may once again come down to downside supports placed around 10,140 and 10,080 before next leg of up-move towards 200 hourly EMA placed around 10,315. Hence, buy on dips is the strategy to be followed.
Nifty patterns on multiple time frames show, rebound from the critical support followed by a Doji candle formation on the daily chart. Hence, Nifty likely to get into a consolidation phase before next leg of up-move towards 30 daily EMA placed around 10320.
The Bank Nifty yesterday ended 0.78 percent up at 24,434.15. It may remain subdued as long as it trades below 200 daily EMA placed around 24,470. 24,000 is the critical support.
Based on thorough technical study, the research house has recommended Bajaj Finance which can give up to 5% return in the near short term:
Bajaj Finance | Rating: Buy | Target: Rs 1840, Stop loss: Rs 1710 | Return: 5%
For Bajaj Finance, consolidation breakout followed by downward trend line breakout around Rs 1740 levels makes the bull case stronger. +DI –DI bullish crossover while MACD has just recovered above the zero line sets the bullish tone stronger. Further, rising RSI is also a bullish factor.
Based on the above mentioned observations, the firm recommends Bajaj Finance as a strong buy on dips for the near-term upside target of Rs 1840.
Disclaimer: The author is Technical Analyst at Stewart & Mackertich Wealth Management Ltd. The views and ideas expressed above may have been suggested to the clients of Stewart & Mackertich Wealth Management Ltd. It is advised that investors/traders should consult with their Certified Experts before taking any investment decision.
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