The Nifty demonstrates a robust bullish trend, characterised by consistent higher tops and higher bottoms observed across multiple time frames, encompassing daily, weekly, and monthly charts. The recent attainment of fresh life highs underscores the prevailing positive sentiment in the market.
The bullish outlook is further substantiated on the weekly chart, where the index confirmed a breakaway gap and has sustained its position above the corresponding level. This confirmation signals a robust bullish undertone, indicative of a favourable medium-to-long-term trajectory. Moreover, the index has successfully achieved the second upside target at the 61.8 percent Fibonacci Extension level, reaching 21,180 as we have discussed in our earlier reports.
Critical technical indicators, particularly the relative strength index (RSI), consistently depict positive momentum, maintaining levels above 65 across daily, weekly, and monthly intervals. This consistent strength in RSI (relative strength index) reinforces confidence in the sustainability of positive momentum in the medium to long term.
Looking forward, the immediate resistance for Nifty is identified at the 21,500 levels, representing the 78.6 percent Fibonacci extension level. Subsequently, there is an additional resistance level at 21,800. On the downside, crucial support levels are recognized at 20,760 and 20,290.
Here are three buy calls for next 3-4 weeks:
Engineers India: Buy | LTP: Rs 169 | Stop-Loss: Rs 157 | Target: Rs 189 | Return: 12 percent
Engineers India is currently at its 52-week high, displaying a pattern of higher tops and higher bottoms, indicating positive momentum in the stock. The rally from its March 2023 low retraced to the 50 percent Fibonacci level, aligning with a polarity reversal level where the November 2019 swing high acted as support.
Post this, the stock continued its upward trajectory with a surge in volume above its 21-week average, highlighting strong structural development and investor anticipation.
Trading above key moving averages, specifically the 30-week and 50-week EMAs (exponential moving average), Engineers India's price trend remains aligned. The ratio chart against Nifty signals a change in polarity, indicating the continuation of outperformance compared to the broader market.
Looking forward, there is an anticipation of further price ascent towards Rs 189 mark. It is recommended to set a stop-loss at Rs 157, strictly based on the closing basis.
RITES: Buy | LTP: Rs CMP: Rs 513.85 | Stop-Loss: Rs 483 | Target: Rs 592 | Return: 15 percent
RITES stock exhibits a healthy uptrend with a consistent pattern of higher tops and higher bottoms, signaling the potential for further upward movement. The price structure evolved from a polarity level, where the swing highs of November 2022 and May 2023 acted as support, enabling the stock to resume its bullish momentum with a notable surge in volume, reflecting investor interest.
An interesting observation is the efficient mean reversion process in RITES since the initiation of the rally in June 2022. During retracements, the stock consistently finds support near the 30-week and 50-week EMAs, illustrating a clear and sustained uptrend.
Analyzing the ratio chart of RITES against Nifty reveals a multi-year polarity, indicating potential outperformance compared to the broader market.
Looking ahead, we anticipate further upward movement in prices, targeting Rs 592 levels. It is recommended to set a stop-loss at Rs 483 based on closing values.
IRFC: Buy | LTP: Rs 92.65 | Stop-Loss: Rs 87 | Target: Rs 108 | Return: 16 percent
Indian Railway Finance Corporation (IRFC) is currently scaling new heights, indicative of significant buying interest and a prevailing positive sentiment.
Following an upward impulse, the stock underwent a 12-week consolidation with diminished volume. The current week witnessed a breakout from this consolidation, marked by a substantial increase in trading volume, signifying the continuation of the upward momentum.
Throughout the rally since March 2023, IRFC has consistently maintained a position above its key 12-week and 26-week moving averages, providing robust support to the positive trend.
The ratio chart of IRFC against Nifty aligns with the prevailing trend and momentum in the stock, suggesting its outperformance compared to the broader market.
Looking ahead, we anticipate further upward movement in prices, targeting Rs 108 levels. It is recommended to set a stop-loss at Rs 87 based on closing values.
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.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
