Sudeep Shah of SBI Securities bullish on UltraTech Cement and Infosys for next week. "UltraTech has given a consolidation breakout on a daily scale, which is confirmed by robust volume," he said.
In the case of Infosys, he believes the stock on weekly scale has given a stage-2 Cup pattern breakout along with relatively higher volume. The stock has strongly outperformed the frontline indices since last couple of weeks, he said.
However, the head of technical and derivative research at SBI Securities advised avoiding Indian Hotels, and Hindustan Unilever. "Indian Hotels is approaching its overbought zone considering the daily RSI, while HUL is in a strong downtrend as it is quoting below its short and long-term moving averages," he said.
Considering the healthy recovery from day's low, do you see the Nifty easily surpassing 25,000 next week?
Sometimes, five days whisper while one day roars, this is what we have witnessed in the last week. The benchmark index Nifty has traded in a narrow range for the five consecutive trading sessions. During these sessions, the index has mostly formed a small body indecisive candle. But we saw strong action on Friday as the index oscillated in 611 points, which was the highest daily range since June 5, 2024.
On Friday, December 13, in the first half of the trading session, the index witnessed a sharp correction of over 350 points. It has taken support near the 38.2 percent Fibonacci retracement level of its prior upward rally (23,263-24,858) and thereafter witnessed a sharp upside rally of over 600 points. Finally, it ended the week at 24,768 level with a gain of 0.37 percent.
What exactly triggered this sharp U-turn in the market? The recovery on Friday was largely driven by largecap stocks, which showed significant strength. The current chart structure of these stocks appears bullish, and we believe they are poised to outperform in the short term. This momentum is likely to push the market higher from its current levels.
Talking about Nifty levels, the zone of 24,500-24,450 will act as crucial support for the index. As long as the index remains above 24,450, it is likely to test the level of 25,100, followed by 25,300 in the short-term. On the downside, if the index slips below 24,450, then the next support is placed at the 24,200 level.
Do you see the blockbuster rally in the Nifty IT index in the coming calendar year?
Yes, we believe, the index is likely to give strong bullish momentum in CY 2025. In July 2024, the index has given a stage-2 Cup pattern breakout on a monthly scale. As per the measure rule of Cup pattern, the upside target is placed at 52,700 level, which is likely to test in the coming calendar year.
Currently, the index heavyweight Infosys has given a Cup pattern breakout on a weekly scale, while TCS is on verge of giving breakout. We believe these stocks are likely to contribute most to the upcoming rally.
Are the charts signaling strong buy on Bharti Airtel for 2025?
Yes, recently, the stock has taken support near its 20-week EMA (Exponential Moving Average) level and thereafter started marking the sequence of higher tops and higher bottoms along with robust volume. Most noteworthy, the weekly RSI (Relative Strength Index) surged above 60 mark for the first time after October 2024 and it is in rising mode. Other momentum indicators and oscillators are also portraying strong bullish momentum in the stock.
Hence, we believe it is likely to test the level of Rs 1,850, followed by Rs 2,000 in the medium-term. On the downside, the zone of Rs 1,560-1,540 is likely to provide the cushion in case of any immediate decline.
Which are your top two bets for next week?
The stock has given a consolidation breakout on a daily scale. This breakout is confirmed by robust volume. The daily RSI is in super bullish zone as per RSI range shift rules. Hence, we recommend to accumulate the stock in the zone of Rs 12,100-12,000 level with the stop-loss of Rs 11,700. On the upside, it is likely to test the level of Rs 12,700, followed by Rs 13,100 in the short-term.
On a weekly scale, the stock has given a stage-2 Cup pattern breakout along with relatively higher volume. The stock has strongly outperformed the frontline indices since last couple of weeks. As the stock is trading at all-time high level, all the moving averages and momentum-based indicators are suggesting strong bullish momentum in the stock. Hence, we recommend accumulating the stock in the zone of Rs 2,000-1,990 level with the stop-loss of Rs 1,935. On the upside, it is likely to test the level of Rs 2,100, followed by Rs 2,140 in the short-term.
Are you super bullish on Indian Hotels?
The overall chart structure of the stock is very strong. However, we feel it is approaching its overbought zone considering the daily RSI. Hence, we recommend avoiding building fresh position at current levels, while existing position can hold with the stop-loss of Rs 830 level.
Is it the right time to pick Hindustan Unilever?
No, the stock is strongly underperforming the frontline indices. Further, the overall FMCG space is underperforming. Technically, it is in a strong downtrend as it is quoting below its short and long-term moving averages. Hence, we recommend avoiding the stock for now.
Are the charts of Paytm and Page Industries looking strong?
Yes, both the charts look strong. The Page Industries has given a consolidation breakout on daily chart and Paytm is marking the sequence of higher tops and higher bottoms. All the moving averages and momentum-based indicators suggest strong bullish momentum in both the stocks.
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