Nifty tested a fresh lifetime high of 14,913.70 on February 4. The up move was broad-based as most sectoral indices, along with the mid and smallcaps, also logged gains.
Nifty remains above the long-term moving averages of 50, 100 and 200-day simple moving averages.
RSI is moving higher as the price rise, which points towards the expanding bullish momentum.
Nifty seems to be moving higher and has started the next phase of upside.
The key support levels to watch out for in the short-term are 14,200, followed by 13,600.
On the upside, the key resistance levels are 15,200 (100 percent extension level of the rise from 13,131-14,753.5 projected from 13,596).
If the index sustains above this level, we might see it head higher towards 15,650 (1 percent extension level of the rise from 13,131-14,753 projected form 13,596).
We expect the index to move higher and test 15,200, followed by the 15,650- mark.
If the index breaches and closes below the 14,200-mark, we might see the correction continue and can expect a test of 13,600-mark.
Here are two buy calls for the next 3-4 weeks:
Canara Bank | LTP: Rs 162 | Target price: 203 | Stop loss: Rs 130 | Upside: 25%
Nifty PSU Bank index, on the weekly timeframe, can be seen breaking out of a consolidation pattern and moving higher.
Canara Bank is one of the outperformers among the PSU bank stocks.
On the monthly timeframe, the stock is placed above Rs 146.65 (high volume bar). On the weekly timeframe, it can be seen riding the upper Bollinger band which shows a bullish undertone of the stock.
In today’s session, the stock not only opened but also sustained above the multi-week resistance of Rs 147.25.
This up-move was backed by above-average volume, indicating participation in the up-move.
The RSI plotted on the medium and the short-term charts can be seen moving higher as the prices move higher, indicating expanding bullish momentum.
The immediate resistance is placed at Rs 178-185 (multiple touchpoint level) followed by Rs 200-203 (a change in polarity level).
The key support levels are Rs 140 and Rs 130. One can buy the stock at the current levels for the target of Rs 185, followed by Rs 203.
Tata Motors DVR | LTP: Rs 130.80 | Target price: Rs 165 | Stop loss: Rs 113 | Upside: 26%
This stock has been one of the strongest outperformers in the auto space.
On February 2, the stock broke above the Rs 116 mark for the first time since October 2018.
This up-move is backed by above-average volume, indicating participation as the prices broke above the multi-month resistance level.
The ADX plotted on the weekly timeframe can be seen placed above the 25- mark and moving higher, indicating strength in the up-move.
Similarly, RSI is moving higher which indicates expanding bullish momentum in the trend.
Going ahead, the immediate resistance is placed at Rs 145-150 (multiple touchpoint level), followed by Rs 162-165 (38.2 percent retracement level of the fall from Rs 378-28.40 and a multiple touchpoint level).
The key support levels are Rs 113 and Rs 100.
One can buy the stock at the current levels and add on dips till Rs 125 with a target of Rs 150 and the second target of Rs 162-165.
(The author is a technical analyst at GEPL Capital)
Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
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