According to Nilesh Jain, the Head - Equity Technical & Derivative Research at Centrum Broking, considering the stock has already rallied nearly 18 percent this month and the RSI is in overbought territory, the risk–reward does not appear favourable for fresh entries at current levels in Maruti Suzuki.
The recent price momentum in HUL indicates that the worst may be behind, he said in an interview to Moneycontrol, adding the stock looks poised to scale new record highs beyond Rs 3,000 in the near term.
He bets on Olectra Greentech, FSN E-Commerce Ventures Nykaa. "Olectra is trading comfortably above all key moving averages, and has also witnessed a golden crossover, while Nykaa, on the weekly charts, has formed a strong base along with a Cup & Handle pattern, which is typically considered a trend reversal formation.
Do you think the worst is over, though the charts are looking weak, or do you see the Nifty bears closing bullish gap?
The Nifty index opened last week with a sharp gap-up and completed its 61.8% retracement of the decline from 25,669 to 24,338 at 25,160. However, the index soon faced sharp profit-taking, slipping below its 50-DMA at 25,010, which now acts as immediate resistance. The bullish gap has almost been filled, suggesting the possibility of near-term consolidation.
On the downside, the 100-DMA at 24,660 remains a crucial support. A decisive break below this level could trigger a retest of the August low at 24,340. Unless this support zone is breached, the index is likely to oscillate in the broader range of 24,400–25,000.
From a positioning standpoint, the FII long-short ratio has fallen to an extreme low of 10:90, highlighting aggressive bearish positioning, whereas DIIs have continued to remain net buyers through the August series.
Overall, the technical setup appears weak, but with the monthly August expiry approaching, any positive trigger could spark a strong short-covering rally in the index.
Do you see the strong possibility of more correction in Bank Nifty, or will it rebound from here on, though it saw a new August low?
The Bank Nifty remains the key drag on the broader markets, weighing heavily on overall sentiment. The index is currently trading well below all its short-term moving averages and has witnessed a structural breakdown. It has already attempted to fill the gap created on May 12 near the 54,000 mark, and a complete fill looks increasingly likely.
For any meaningful recovery, it is crucial for the index to reclaim the 21-DMA and 100-DMA, both placed around the 55,500 level. Until then, the technical setup remains weak. On the downside, immediate support is seen at 53,500, while the 200-DMA at 52,900 will act as a critical level to watch. Momentum indicators and oscillators on the weekly chart have triggered a sell crossover, reinforcing a sell-on-rise bias in the short term for the Bank Nifty.
Do you see the uptrend continuing in Britannia Industries and Eicher Motors?
The consumption space is back in focus, with defensives once again attracting attention amid prevailing market uncertainty. Britannia has been steadily inching higher, crossing above all its key short-term and long-term moving averages. A bullish crossover on the MACD, along with the RSI moving above 55, indicates strength and supports the likelihood of a continued uptrend. The stock has potential to move towards Rs 6,200, while immediate support is placed at Rs 5,530.
Eicher Motors remains in a secular uptrend, now trading in uncharted territory. The recent breakout, supported by higher-than-average volumes, suggests strong momentum is intact. In the near term, the stock is poised to move towards Rs 6,500, while immediate support is placed at Rs 5,850.
What are your top 2 bets?
The stock is forming a large rounding bottom pattern and is gradually moving higher. It is trading comfortably above all key short-term and long-term moving averages, and has also witnessed a golden crossover, with the 50-DMA crossing above the 200-DMA, signalling strong momentum in the near term. Based on this setup, the stock is expected to move towards Rs 1,770, while a stop loss can be placed near its 21-DMA support at Rs 1,465.
On the weekly charts, the stock has formed a strong base along with a Cup & Handle pattern, which is typically considered a trend reversal formation. A decisive breakout above Rs 232 would provide bullish confirmation, opening the way for an upside target near Rs 280 as per the pattern projection.
Momentum indicators and oscillators are firmly in buy mode on both the daily and weekly timeframes, further supporting the positive outlook. On the downside, the 100-DMA at Rs 203 serves as a crucial support. Hence, the stock can be considered for addition post a breakout above Rs 232, with an upside potential towards Rs 280 and a stop-loss placed at Rs 203.
Are you super bullish on Maruti and HUL, considering the charts?
Maruti Suzuki has given a breakout from a triangle pattern near Rs 13,400, supported by a breakaway gap. The conservative target of this breakout is placed around Rs 15,500, while the aggressive target stands at Rs 16,500. However, considering the stock has already rallied nearly 18% this month and the RSI is in overbought territory, the risk–reward does not appear favourable for fresh entries at current levels. Instead, the stock can be accumulated in a staggered manner as a positional buy, with key support placed at Rs 13,400.
Hindustan Unilever (HUL) has emerged from a four-year consolidation phase, and the recent price momentum indicates that the worst may be behind. The stock looks poised to scale new record highs beyond Rs 3,000 in the near term, with immediate support at Rs 2,520.
What is the likelihood of the Nifty Midcap 100 and Smallcap 100 indices breaking their August lows?
The broader markets have witnessed deeper cuts compared to the benchmark indices in the August series. Both the Nifty Midcap and Nifty Smallcap indices are currently trading below their respective short-term moving averages, signaling a weak near-term structure.
The Nifty Smallcap index appears precariously positioned, hovering close to a breakdown from its long-term 200-DMA at 17,500. A breach below this level would further dent sentiment and intensify selling pressure. Meanwhile, the Nifty Midcap index continues to face stiff resistance near its 50-DMA at 58,000, where persistent supply has been observed. Although the index earlier managed to defend its 100-DMA, the same level is now being retested, highlighting vulnerability.
Overall, the broader structure of both indices remains weak, with a high probability of breaking their August lows in the immediate term.
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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