Although the Nifty on Wednesday rebounded from the lowest point of the day, the short-term outlook for the market remains feeble, given that the index ended the session below the vital short-term moving average of 21 days.
The relative strength index (RSI) shows a bearish crossover, further amplifying the pessimistic sentiment. The prevailing trend will continue to lack strength as long as it maintains levels below 19,521, where the 21-day exponential moving average (EMA) is placed. Looking downward, the initial support level is seen at 19,250.
The Bank Nifty index recently found support at a crucial level, the 100-day moving average (DMA), at 43,600. The index's potential to experience a pullback rally is contingent on maintaining this level above the 100DMA on a closing basis.
The immediate obstacle for the index is situated around 44,000. An upward breach beyond this level could validate a move towards 44,300 or 44,500 levels.
Here are three buy calls for short term:
Power Grid Corporation of India: Buy | LTP: Rs 248 | Stop-Loss: Rs 240 | Target: Rs 270 | Return: 9 percent
Power Grid is exhibiting an ascending pattern characterized by the formation of higher highs and higher lows. Additionally, the price is currently positioned above a significant moving average.
The daily RSI has undergone a bullish crossover. Looking at the upper range, there's a possibility of it advancing toward the range of Rs 265-270. On the downside, a support level is established at Rs 240.
NTPC: Buy | LTP: Rs 217.45 | Stop-Loss: Rs 210 | Target: Rs 230 | Return: 6 percent
Following a notable rally, the NTPC stock experienced a corrective phase and found support at its 20-day moving average (20DMA). The momentum indicator, RSI, signaling a positive crossover, affirms the strengthening momentum.
An essential support for the stock lies at Rs 210, anticipated to provide a buffer for the bulls. Meanwhile, the potential upside targets are marked at Rs 226-230.
KPIT Technologies: Buy | LTP: Rs 1,135.55 | Stop-Loss: Rs 1,100 | Target: Rs 1,220 | Return: 7.4 percent
The stock has demonstrated its ability to maintain a position above the crucial moving average, indicating an ongoing bullish trend. A favourable crossover in the weekly RSI implies a growing sense of positive momentum.
In the short term, there is potential for the stock to ascend toward higher levels. As a downside safeguard, support is established at Rs 1,100, while resistance is noted at Rs 1,220.
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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