Domestic markets finally got a chance to book profits towards the end of the week gone by. The Nifty index opened at a new high of 22,125 in the first few trading sessions. However, after some disappointing earnings from HDFC Bank, the market went into a panic and the index lost nearly 800 points from the highs. After briefly touching a low of 21,300, the benchmark finally closed at 21,572, down around 1.5 percent, in the week ended January 20.
Technically, the Nifty has broken from the ascending trendline and the pattern is also similar to a head-and-shoulder formation. Going forward, the crucial support for the index will be the weekly low at 21,285. If the level is breached, the bulls will lose their confidence and the panic will spread throughout the markets.
However, if the Nifty recovers, the level of 21,800-21,900 will be a true test for the bulls as the daily scale has a gap area. We continue to advise traders to be light from now on and stay stock-specific.
The banking index is once again in the bearish territory after the Nifty overcame the HDFC Bank fallout. From a high of 48,000, the index dipped below 45,500 and breached the prior demand zone.
From now on, the level of 45,400 to 44,500 could be a strong support level for the index as it is a gap area and a significant retracement level for the entire rally that started from 42,000. On the other hand, a break above 46,500 might bring banks back into focus.
Here are three buy calls for next 2-3 weeks:
Greaves Cotton: Buy | LTP: Rs 165 | Stop-Loss: Rs 143 | Target: Rs 200 | Return: 21 percent
The entire 2023 year went by, consolidating around 100–200 DEMA (exponential moving average), followed by recent bear trendline violations (refer to the chart). Also, volume is picking up from lower levels, thus making it attractive at current levels.
On the indicator front, the weekly MACD (moving average convergence divergence) has given a bull cross just near the zero line, which further affirms our bullish stance.
Thus, one can buy in the zone of Rs 160–165 with a target of Rs 200 and a stop-loss of Rs 143 on a daily basis.
Cochin Shipyard: Buy | LTP: Rs 874 | Stop-Loss: Rs 815 | Target: Rs 950 | Return: 9 percent
The said counter has been in a stellar rally since it has been making higher highs and higher lows. Also, it has nicely followed major DEMAs on a regular basis. In previous trading sessions, it has taken out its previous swing high and sustained above it.
On the indicator front, daily stochastics has entered the overbuy zone once again, which is a sign of strength. Thus, one can buy in the zone of Rs 855–875 for a target of Rs 950, and the stop-loss would be Rs 815 on a daily close basis.
Tanla Platforms: Buy | LTP: Rs 1,178 | Stop-Loss: Rs 1,107 | Target: Rs 1,300 | Return: 10 percent
Since the last 3 weeks or so, the said counter has been consolidating in zones Rs 1,070–1,150. On January 10, 2024, it took out the said range, thus making it lucrative at current levels.
On the indicator front, the weekly MACD has given a bullish cross exactly above the zero line, which is a sign of further bullishness in the counter. Thus, one can buy in the range of Rs 1,165–1,180 with an upside target of Rs 1,300 and a stop-loss of Rs 1,107 on a daily close basis.
Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
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