After an intense tug-of-war throughout the week ended February 17, the Nifty settled around 17,950 levels, procuring nearly half a percent from the previous week's closure.
The lack of follow-up buying nullified the breakout attempt, and we fell back in the same zone from where we had started. However, the recent price action could be seen as constructive development for our markets as the index is hovering above the sloping trendline and has also attempted to transcend the sturdy hurdle of the 18,000 mark after two weeks of consolidation.
As far as levels are concerned, we remain hopeful till the sacrosanct support of 17,800-17,700 is firmly withheld. On the flip side, sustenance above 18.000 could only bring the cheer back in the market, while on the higher end 18,200 is likely to be the sturdy wall in a comparable period.
We remain sanguine with the up trend and would advise the traders to utilise the dips to add long position in the index.
Here is one buy call and one sell call for short term:
UltraTech Cement: Buy | LTP: Rs 7,297.85 | Stop-Loss: Rs 7,170 | Target: Rs 7,600 | Return: 4 percent
Only handful of ‘cement’ stocks have been performing well in last few months and UltraTech is certainly one of them. The stock did not participate in the recent destruction, in fact, remained sideways by maintaining its sturdy structure.
Now, on Friday, the stock prices finally burst through its consolidation phase to confirm a breakout from the ‘Bullish Flag’ pattern on the daily chart.
The volumes have been gargantuan to support this strong up move. We recommend buying for a trading target of Rs 7,400. The stop-loss can be placed at Rs 7,170.
Manappuram Finance: Sell | LTP: Rs 108.80 | Stop-Loss: Rs 111.2 | Target: Rs 105.5 | Return: 3 percent
This stock has been undergoing a corrective phase since last many months now. Recently, we observed prices stalling around its key short-term moving average for nearly three weeks.
On Friday, the consolidation range finally got broken on the lower side. This not only confirmed a breakdown from multiple supports but also resulted in resuming its higher degree downtrend.
The stock is now likely to continue its slide towards the ‘200-day SMA (simple moving average - Rs 104.4)’. Traders can short this counter for a short-term target of Rs 105.50. The strict stop-loss can be placed at Rs 111.20.
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