Chartist Talks: Sudeep Shah of SBI Securities sees Nifty testing 22,800 support next week, bullish on these 3 stocks

Yes, on a weekly scale, the RSI (Relative Strength Index) has taken support near 60 levels and witnessed a strong rebound, which is a strong bullish sign as per RSI range shift rules. Further, all the moving averages-based setups show strong bullish momentum. Hence, we believe the stock is likely to continue its northward journey and test the level of Rs 650, followed by Rs 670 in the short term.

Are the charts giving a signal to take a long-term trade in Hindustan Unilever and Britannia?

Yes, both stocks have established a solid base near their key support levels. Additionally, momentum indicators and oscillators are displaying bullish divergence, suggesting a potential upward move. Therefore, we recommend accumulating a partial quantity at the current levels while keeping an eye on further confirmations for a sustained uptrend.

Do you see the high possibility of Nifty decisively breaking 23,000 next week?

Yes, we believe the benchmark index Nifty is likely to test the support level of 22,800 in the next week. The index has ended on a negative note for the third consecutive week, reflecting sustained bearish pressure. All key moving averages and momentum indicators are signaling strong downside momentum, further confirming the weakness in the trend. Additionally, the index continues to underperform its global counterparts, which adds to the overall negative sentiment. This clearly indicates bearish momentum in the index.

Will the Bank Nifty manage to hold the low of January 13 next week?

For the second consecutive week, the banking benchmark index Bank Nifty has formed a candle with a long upper shadow, signaling selling pressure at higher levels. Additionally, the weekly RSI has dropped below the 40 mark for the first time since June 2022, indicating weakening momentum.

We believe that if the index breaches the crucial 47,898 level, which is low of January 13, it could trigger a sharp correction in Bank Nifty, and participants should remain cautious around this key support.

What are your top 2 ideas for next week?

Zensar Technologies

The stock has given a horizontal trendline breakout on a daily scale. The breakout is confirmed by robust volume. In addition, it has formed a sizeable bullish candle on a weekly, which adds more bullishness. Further, momentum indicators and oscillators are also suggesting strong bullish momentum. Hence, we recommend accumulating the stock in the zone of Rs 835-825 level with the stop-loss of Rs 800 level. On the upside, it is likely to test the level of Rs 890, followed by Rs 920 in the short term.

Wipro

The stock has given a trendline breakout along with robust volume. The stock has formed a sizeable bullish candle on a weekly scale, which adds more bullishness. The momentum indicators and oscillators are also suggesting strong bullish momentum in the stock. Hence, we recommend accumulating the stock in the zone of Rs 320-318 level with the stop-loss of Rs 309 level. On the upside, it is likely to test the level of Rs 335, followed by Rs 350 in the short term.

Q: Is Mphasis a strong buy?

While we do not observe a textbook triple bottom pattern, the stock is indeed a strong buy. It has established a solid base near its 200-day EMA and has resumed its upward trajectory. Notably, the reversal from the support zone is backed by robust volumes, which adds conviction to the move. Furthermore, all moving averages and momentum-based indicators suggest strong bullish momentum, reinforcing the positive outlook for the stock.

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