On the weekly timeframe, we can spot that the prices have shown a bounce from the 50 percent Fibonacci retracement level of the prior advance from 16,747 (September 2022) till 18,887 (November 2022), which is again in sync with the bearish trendline which shows change in the polarity.
Nifty on daily charts has formed an Outside bar which points towards the rising volatility of the prices.
On the indicator front, RSI (relative strength index) plotted on the Weekly timeframe is sustaining above 50 mark reflecting strong momentum of the prices.
The Nifty has immediate resistance placed at 18,300 (multiple touch points) followed by 18,450 (key resistance) levels. The downside support for the index is placed at 18,100 (multiple touch points) followed by 17,845 (key support).
By looking at overall trend and evidence supported by indicator, we feel that the Nifty will move higher till the level of 18,300 followed by 18,450. Our bullish view will be negated if we see prices sustaining below 17,845.
Here are three buy calls for next 2-3 weeks:
Jindal Stainless: Buy | LTP: Rs 226.30 | Stop-Loss: Rs 200 | Target: Rs 260 | Return: 15 percent
JSL is currently trading at its record high which tells that the stock already is in strong momentum.
In the latest week, the counter witnessed a breakout from the rounding bottom pattern indicating continuation of prior uptrend.
The ratio charts against Nifty metal is rising which shows the outperformance from the stock.
The stock is currently trading above its key moving averages (50 & 200 days EMA - exponential moving average) confirms the uptrend.
RSI plotted on the weekly timeframe is rising and have sustained above 60 mark which reflects the rising momentum of the underlying trend.
Going ahead we expect the prices to go higher till the level of Rs 260 where the stop-loss must be Rs 200 on the closing basis.
State Bank of India: Buy | LTP: Rs 611.80 | Stop-Loss: Rs 557 | Target: Rs 724 | Return: 18 percent
Looking at a broader picture of SBI, we can observe that the correction post November 2021 the stock did not get into Lower Low, Lower High formation, this shows positive under tone of the prices.
The stock has shown a bounce to the upside after retesting the rectangle pattern, the breakout was witnessed in the last week of October 2022.
The bounce in the prices was preceded by the stock taking support from the 20-week EMA. The 20-week EMA has acted as a strong variable support for the prices.
RSI on the daily timeframe have shown a bullish reversal which points towards the rising momentum of the prices.
Going ahead we expect the prices to go higher till the level of Rs 724 where the stop-loss must be Rs 557 on the closing basis.
Kirloskar Ferrous Industries: Buy | LTP: Rs 358.95 | Stop-Loss: Rs 310 | Target: Rs 450 | Return: 25 percent
Kirloskar Ferrous has shown a rise from the 50 percent Fibonacci retracement of the prior advance from Rs 37 level (March 2020) till 313 level (July 2021).
The stock in the first week of December 2022 gave a breakout from the rounding bottom pattern, which indicated beginning of the trend to the upside.
The breakout is confirmed as it is accompanied by Higher volumes.
The stock has shown a bounce while taking support from the 14-week EMA which acted as a strong variable support for the prices. The 14-week EMA acted as a strong variable support for the prices.
Going ahead we expect the prices to go Higher till Rs 450 where the stop-loss must be Rs 310 on the 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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