Jaydeb Dey
The Nifty in the previous session ended 0.29 percent lower at 10,741.10. It opened on positive note above 10,800-levels and got sold off towards ending the session with a bearish candle.
Ending the session with a bearish candle nearer to day’s low suggests, it may once again challenge supports placed around 10,700 levels. Next most crucial midterm upward trend line support is placed around 10,680 levels. Hence, staying cautious on rise is advised.
However, traders and investors may once again accumulate blue chip stocks on dips around dual supports placed around 10,700 and 10,680.
On the Nifty hourly chart, it is once again coming down to the 200-EMA placed around 10,710 levels. Chart pattern along with position of leading indicators suggests, it may see buying on dips around dual supports placed around 10,700 and 10,680.
Nifty patterns on multiple time frames show that the index ended the session with a bearish candle and may once again retest downside dual supports placed around 10,700 and 10,680. However, aggressive short selling at this juncture is not advised.
The Bank Nifty in the previous session ended 0.23 percent lower at 26,496.65. It ended the session with a bearish Marubozu candle. Immediate support is placed around 26,450. Next, most crucial support is placed around 26,200 whileupside resistance is placed around 26,700.
Based on thorough technical study, the research firm recommends Housing Development and Infrastructure (HDFC) which can give up to 4 percent return in the near term:
HDFC | Rating: Buy | Target: Rs 1920, stop loss: Rs 1800, Return: 4%
The stock ended the session with a symmetric triangle pattern breakout. This breakout is backed by rising RSI while +DI –DI bearish crossover is already done. Rising OI makes the bull case even stronger.
Based on above mentioned observations, the firm recommends HDFC as a buy on dips for the short term upside target of Rs 1920.
Disclaimer: The author is Technical Analyst at Stewart & Mackertich Wealth Management Ltd. The views and ideas expressed above may have been suggested to the clients of Stewart & Mackertich Wealth Management Ltd. It is advised that investors/traders should consult with their Certified Experts before taking any investment decision.
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