The Nifty has exhibited a bearish trend in the short to medium term, as observed on the weekly charts. A big bearish candle was formed after a Spinning Top candle pattern, confirming a bearish undertone.
Additionally, the 20-week SMA (simple moving average) acted as resistance, causing prices to reverse downward. On the daily charts, the lower top lower bottom formation persisted throughout the week, with seven consecutive bearish candles indicating a negative trend.
The weekly RSI (relative strength index) displayed a lower low, lower high pattern, reflecting a lack of positive momentum.
Looking ahead, the immediate support level for the Nifty is at 17,350 (swing low), followed by 16,747 (key support). Conversely, the resistance levels are at 17,770 (key resistance) and 18,000 (weekly high).
It is anticipated that the index may continue to decline towards 16,747 if it falls below 17,353.
Here are three buy calls for next 2-3 weeks:
Mahindra CIE Automotive: Buy | LTP: Rs 448.60 | Stop-Loss: Rs 400 | Target: Rs 520 | Return: 16 percent
Mahindra CIE Automotive stock showed a remarkable rally since the last week of May 2022. The running Inverse Head & Shoulder pattern breakout suggests strong market interest and optimism in the continuation of the stock's prior uptrend.
Rising volumes accompanied by higher volumes indicate long built-up behind the stock.
The 20-week EMA (exponential moving average) has acted as excellent variable support for the stock, and prices have taken support before the breakout.
Ratio charts against the Nifty Auto Index show a multi-year Breakout highlighting the stock's strong outperformance and suggesting it may continue to outperform.
The anticipated price target for the stock is Rs 520, with a stop-loss of Rs 400 strictly on the closing basis.
Shivalik Bimetal Controls: Buy | LTP: Rs 445.30 | Stop-Loss: Rs 410 | Target: Rs 520 | Return: 17 percent
Shivalik Bimetal Controls has demonstrated a notable uptrend in its stock price since its listing on July 21, 2021. Despite experiencing a correction from April 18, 2022, the prices did not break supports and underwent a polarity change around Rs 370 level. This observation underscores the resilient nature of the stock's price movement during the correction phase.
The recent breakout of Descending Triangle pattern indicates that the stock is all set to climb higher levels.
When examining the daily timeframe of the stock, it is apparent that the stock's price is currently trading above its key moving averages, including the 50-day, 100-day, and 200-day exponential moving averages (EMA). This observation confirms the presence of a bullish trend in the stock's price movement.
The RSI on the weekly timeframe has given a breakout too which shows the strong bullish momentum.
Going ahead we expect the prices to move higher till the level of Rs 520 where the stop-loss must be Rs 410 on the closing basis.
PB Fintech: Buy | LTP: Rs 576.80 | Stop-Loss: Rs 525 | Target: Rs 680 | Return: 18 percent
PB Fintech's stock prices have recently surpassed Rs 501 level, indicating a beginning of an uptrend through the formation of higher highs and higher lows.
Additionally, the stock has shown a rebound after testing the neckline of the Cup & Handle pattern, which had given a breakout two weeks prior - a reversal pattern. This breakout is further confirmed by higher trading volumes.
Moreover, the 17-week exponential moving average (EMA), which previously acted as resistance during the downtrend, is now acting as support, reinforcing the uptrend.
On the weekly timeframe, the Relative Strength Index (RSI) has shown a shift in range, indicating a rising momentum in prices.
Looking ahead, we anticipate prices to continue to climb until reaching Rs 680 level, with a recommended stop-loss at Rs 525 on a 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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