"The start of Samvat 2081 is not going to be easy," Ashish Kyal, CMT, founder and CEO of Waves Strategy Advisors, said in an interview to Moneycontrol.
According to him, Nifty's low made in August is at 23,893 which is hardly 300 points away, hence there is high likelihood that the low can be breached in November 2024. "And we can move towards the topping Head & Shoulder pattern target near 23,300 level," he said.
Kyal, with more than two decades of experience in capital markets, recommends Poly Medicure and Fortis Healthcare for Muhurat trading.
Edited excerpts:
What is the possibility of Nifty breaking August low in the first month of Samvat 2081?
Nifty has been correcting since the top formed near 26,277 on September 27. Prices ended the month of October with a close below prior month's low, high below prior high, low below prior low after 18 months since the low of 16,828 to the rise of 26,277 - a rise of 10,000 points is complete. This indicates that the start of Samvat 2081 is not going to be easy. Low made in the month of August 2024 is at 23,893 which is hardly 300 points away. There is high likelihood that the low can be breached in November 2024 and we can move towards the topping Head & Shoulder pattern target near 23,300 levels.
On upside, 24,490 has been immediate hurdle and prices have failed to close above it despite of multiple attempts. A move above this level will indicate a relief rally before we move down.
In a nutshell, Nifty if breaches below 24,070 can head towards 23,700 followed by 23,300 levels with upside hurdle near 24,490 followed by Gann level of 24,723. From Elliott wave perspective this can be wave 3 move on downside.
What should be your positional strategy for the new series starting on Friday, with Laxmi Pujan?
Over past few years, the trend for Nifty has been positive for atleast a few weeks before the Muhurat trading day. This has resulted into Gap up opening on Muhurat day and then the uptrend continued subsequently. However, this time prices are moving down since a few weeks. So we can expect a positive opening on the Muhurat day but if prices break below 24,070 then the downtrend can resume taking it towards 23,700 levels.
Positional strategy will be to sell on break below 24,070 for trend to 23,700 levels.
Are you cautious on the Nifty IT that decisively broke the support trendline after several weeks of consolidation?
Yes as the major support of 41,100 was broken, so it is time to get cautious. The next crucial support is located near 39,750 levels which is also the Gap area. So Nifty IT can show short term correction but medium to long term trend still remains positive for this index. Any move back above 41,500 will resume positive trend in IT stocks.
Your top two medium term bets on Laxmi Pujan?
The stock has just given a breakout of the Rounding bottom pattern. Also, since October 28 not a single candle has given a close below previous day's low, which suggests strength in trend. We can expect rise to continue with the targets of Rs 3,300. On the downside, nearest support is at Rs 2,650 levels.
The stock is currently accumulating in a wider range of Rs 570-630. A break above Rs 630 can result into fresh rise with the targets of Rs 680 with the support of Rs 600 levels.
Will Zomato break 200-day EMA considering the Rounding Top formation, and are you bullish on Larsen & Toubro?
Zomato is currently trading near its important support zone which is near Rs 240 levels. A daily close below it can result into further more correction towards 200-day EMA which is near Rs 212 levels. We can expect stock to find support at 200 EMA, which can provide buying opportunity from medium term perspective. In nutshell, we can expect short term correction in this stock.
Larsen & Toubro (L&T) showed sharp reversal on upside post the quarterly results. We can expect fresh buying in L&T if it manages to close above Rs 3,650 levels for the targets of Rs 3,850.
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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