On the weekly chart, prices are maintaining a higher high, higher low formation since the past six weeks. On the daily timeframe, the index has closed above prior day low for the sixth consecutive day. These reflect a revival in buying on the lower levels.
The relative strength index (RSI) on the daily timeframe is rising while forming higher high, higher low with the overall price trend. This reflects a rise in momentum with price.
The Nifty has an immediate resistance levels placed at 18,178 (prior day's high) followed by 18,350 (January 2021 high) and on the other side, it has strong support level placed at 18,000 (psychological support) followed by 17,838 (Gap support).
As per the overall texture of trend and evidence supported by indicators we feel that Nifty will move higher till the level of 18,178 followed by 18,350. Our bullish view may negate if we see prices sustaining below 17,838.
Here are three buy calls for next 2-3 weeks:
ABB India: Buy | LTP: Rs 3,225 | Stop-Loss: Rs 2,960 | Target: Rs 3,850 | Return: 19 percent
Looking at the broader picture of ABB, we can spot that the stock is moving in uptrend while following the bullish channel. The stock has started to move on the upside after retesting the bullish channel post the breakout on August 22, 2022.
The prices took support from the 18-week EMA (exponential moving average) before moving higher, which means the 18-week EMA has acted a variable support to the prices. This indicates the beginning of the trend on the upside.
RSI plotted on the Weekly timeframe have shown a bullish reversal, indicates rising momentum in the prices.
Going ahead we expect the prices to go higher till the level of Rs 3,850 where the stop-loss must be Rs 2,960 on the weekly closing basis.
Syngene International: Buy | LTP: Rs 639.15 | Stop-Loss: Rs 570 | Target: Rs 820 | Return: 28 percent
The correction in Syngene post January 2021 was orderly, the stock did not get into it’s lower low, lower high formation against the benchmark Nifty50. This shows that the stock is relatively stronger.
In the latest week, the stock has given a breakout of Descending triangle pattern, which indicates beginning of trend on the upside.
On the daily timeframe the Bollinger band have started to expand after a narrow range, indicating increase in volatility.
RSI on the weekly as well as on the daily timeframe is above 50 mark, reflecting the rising momentum in the prices.
Going ahead we expect the prices to go higher till the level of Rs 820 where the stop-loss must be Rs 570 on the weekly closing basis.
Craftsman Automation: Buy | LTP: Rs 3,140.35 | Stop-Loss: Rs 2,700 | Target: Rs 3,800 | Return: 21 percent
Craftsman is currently trading near its record high level which tells that the stock already is in good momentum.
The stock gave breakout from the Inverse Head and shoulder pattern on July 18, 2022, indicated beginning of the trend on the upside.
Prices have come out a narrow consolidation level of Rs 2,973 - 2,600, this continuation of prior uptrend.
On the daily timeframe Bollinger band have started to expand, indicating increasing volatility of the stock.
RSI on the weekly timeframe have shown a range shift reflecting rising momentum in the prices.
Going ahead we expect the prices to move higher till the level of Rs 3,800 where the stop-loss must be Rs 2,700 on the weekly closing basis.
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