Vidnyan Sawant, AVP - Technical Research, GEPL Capital
The Nifty has maintained its lower top lower bottom formation on the daily charts, however, it has managed to sustain above the 17,000 mark consistently for the last three sessions and formed a reversal candle pattern like Piercing Line and Hammer candle pattern on the daily charts, indicating some kind of bottoming out for the short to medium term.
The RSI (relative strength index) indicator on lower timeframes has placed below 40 mark, however, it is showing price momentum divergence.
The Nifty has resistance at 17,450 and 17,776 levels, whereas the support lies at 16,836 mark.
The index shows initial signs of bottoming out near the 17,000 mark and could give a pullback towards 17,450-17,776 levels. On the flip side, if the index breaks below 16,836, then it can move lower towards 16,600–16,410 levels.
Here are three 'buy' calls for the next 2-3 weeks:
Axis Bank: Buy | LTP: Rs 773.85 | Stop-Loss: Rs 705 | Target: Rs 867-938 | Return: 21 percent
Axis Bank has taken a strong support near Rs 645 levels which is a 38.2 percent Fibonacci retracement level of previous advance from Rs 286–867 levels. The stock has sustained at three-month high with the formation of higher top higher bottom pattern on the weekly charts.
On the daily charts, the stock has sustained above its 200-day SMA (Rs 737) with volume confirmation.
The RSI plotted on the weekly chart can be seen moving higher after forming a bullish hinge near the 50 mark, indicating increasing bullish momentum in the prices.
Going ahead, we expect the prices to move higher towards Rs 867 mark immediately, followed by Rs 938. We recommend a strict stop-loss of Rs 705 on daily closing basis.
Maruti Suzuki: Buy | LTP: Rs 8,820.20 | Stop-Loss: Rs 8,350 | Target: Rs 9,950 | Return: 13 percent
Maruti Suzuki has given a consolidation channel pattern breakout with volume confirmation which has been forming since September 2020 on the weekly charts. The stock is sustaining at multi-year high which shows strong positive undertone for the medium to long term.
The RSI plotted on the weekly chart managed to sustain above the 60 mark and is currently moving towards higher level, indicating increasing bullish momentum as the prices move higher.
Going ahead, we expect the prices to move higher towards the Rs 9,500 mark. If the prices manage to breach and sustain above the Rs 9,500 level, we might see further up move towards Rs 9,950 mark eventually. We recommend a strict stop-loss at Rs 8,350 on daily closing basis.
State Bank of India: Buy | LTP: Rs 528.95 | Stop-Loss: Rs 501 | Target: Rs 580 | Return: 10 percent
SBI is sustaining near its life time High levels. The stock has been forming a bullish pattern of higher top higher bottom on all the time frames like daily, weekly and monthly charts which indicates strong positive sentiments for the medium to long term.
The RSI indicator has given a bullish hinge near 60 levels and moving upward indicating strong positive momentum of the stock.
One can look to buy SBI with a target of Rs 580 and maintain a stop-loss of Rs 501 on daily closing basis.
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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