The breakdown below 11,100 could trigger a further supply till 10,850. Resistance is near 11,375, a break of this level will open the gate for 10,600 in the benchmark index.
Nifty has been trading in a very narrow range since it tested the lower band of the rising channel pattern on the daily timeframe.
There is not much progress in this week’s daily chart compared to its previous week's charts.
On August 12, both Nifty and Bank Nifty opened almost a percent lower and later on a constant buying support in some heavyweight stocks, pushed Nifty closer to yesterday's close.
For the last four months, the benchmark index has been trading in a rising channel formation and within that period, prices have respected the lower band of the channel almost three times and successfully rallied higher.
In the last one month, India VIX flattened out and had been reading in a range of 26 -23 levels.
On August 11, India VIX index witnessed a breakdown of the smaller degree trendline on the daily interval and on August 12, it continued its breakdown trend and contracted by 2.41 percent, closing below 21 levels.
Market breadth remained strongly in favour of bulls. For five gainers, there were three losers.
There are expectations of a good announcement on taxation, health care, new FDI announcement and dedicated financial institution for the infrastructure funding.
We expect some consolation at the current level with time-wise correction.
The breakdown below 11,100 could trigger a further supply till 10,850. Resistance is near 11,375, a break of this level will open the gate for 10,600 on the benchmark index.
Here are three buy calls for the next 2-3 weeks:
On the weekly chart, the stock has given a breakout of the consolidation pattern.
A bullish candle formed on the weekly timeframe which is above its previous several weeks high.
It has also surpassed the double top resistance placed at Rs 1,390 odd levels. Volumes have also gone up along with the price breakout.
The stock is placed above all important moving averages, indicating a bullish trend. The majority of indicators and oscillators are showing a positive trend for the current scenario.
Traders can accumulate the stock in the range of Rs 1,428-1,440 for the target of Rs 1,690.
On the daily chart, SRF has given a breakout from the consolidation pattern, sustaining above all its major exponential moving averages.
A bullish candle formed on the weekly chart has closed above its previous several weeks high.
The majority of indicators and oscillators are showing a positive trend for the current scenario.
Since March 20, prices are trading in higher high, higher low formation on the daily chart which is a positive structure for short to medium-term.
Traders can accumulate the stock in the range of Rs 4,140 - 4,160 for the target of Rs 4,600.
On August 7, the stock prices finally managed to surpass the multiple resistance zones around Rs 540 – 550, which eventually confirmed a triangle pattern breakout on the daily interval.
After the breakout, the stock took a breather, witnessing a throwback near its trendline support.
The recent strong up-move is also supported by strong volumes and it also resembles a strong consolidation breakout.
The stock is trading above its 21 and 50-day exponential moving averages on the daily chart.
Momentum oscillator RSI (14) is reading above 60 levels with positive crossover, which is positive for the counter.
The MACD indicator is reading above the line of polarity with positive sentiments. Traders can accumulate the stock in the range of Rs 548 - 552 for the target of Rs 585.
(The author is Technical Analyst, Bonanza Portfolio)Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.