By Vidnyan Sawant, AVP - Technical Research at GEPL Capital
On a monthly perspective, the Nifty Index has staunchly adhered to a crucial previous month's low situated at 19,220. This threshold seems to be propelling its forward bullish momentum. Notably, a confluence of price actions at this juncture, underscored by uniform lows seen in the last trio of months, designates it as a vital support arena.
Shifting focus to the weekly panorama, the Index portrays a Hammer candlestick. Such a configuration often hints at market improving its trend, indicating a probable pause to the bearish stride that held sway over the past 3 weeks. Lending weight to this notion, the 20-week SMA (simple moving average - 19,270) has recurrently played the role of a dynamic buffer for the Index.
Key landmarks for the Index encompass a sturdy floor at 19,200 (a consistent support point), succeeded by supports at 19,000 and 18,870. On the flip side, the index might face headwinds at 19,800, with additional resistance markers set at 20,000 and subsequently at 20,222.
Given Nifty's overarching bullish tilt and its position adjacent to a strategic support zone, there lies a palpable potential of it rallying towards the 20,000 milestone, provided it surpasses the 19,800 resistance. However, any descent below 19,200 might negate our bullish stance.
Here are three buy calls for next 2-3 weeks:
Sun TV Network: Buy | LTP: Rs 634.15 | Stop-Loss: Rs 607 | Target: Rs 705 | Return: 11 percent
The stock is presently trading at a multi-year high level, surpassing Rs 580 mark in mid-August 2023. This signifies a significant milestone and reflects the stock's strong bullish sentiment.
An interesting observation is the change in polarity that occurred around Rs 580 levels. This change indicates a shift in market sentiment from bearish to bullish, further supporting the positive undertone in the stock's price.
Moreover, when analyzing the weekly charts, the moving average convergence divergence (MACD) indicator is steadily ascending above the zero line. This consistent upward movement in the MACD emphasizes the presence of sustained positive momentum in the stock.
Looking forward, there is a reasonable expectation for the stock's price to continue its upward trajectory, potentially reaching Rs 705 levels. To manage risk effectively, it is advisable to implement a stop-loss at Rs 607, strictly on a closing basis.
L&T Finance Holdings: Buy | LTP: Rs 131.50 | Stop-Loss: Rs 125 | Target: Rs 155 | Return: 18 percent
The stock's positive trajectory gains validation from the 12-week exponential moving average (EMA), suggesting the consistency of its bullish run. Moreover, the relative strength index (RSI) reveals a bullish hidden divergence, accentuating the increasing momentum in the stock's price dynamics.
Moving forward, we anticipate the stock price to ascend towards Rs 155 mark, with a recommended stop-loss at Rs 125, strictly enforced on a closing basis.
Godfrey Phillips India: Buy | LTP: Rs 2,136.25 | Stop-Loss: Rs 2,010 | Target: Rs 2,400 | Return: 12 percent
Godfrey Phillips shares maintained their impressive ascent. From December 2022, the stock has undergone noteworthy corrections but hasn't manifested any lower highs or lows.
Approaching its record peak, the sustained bullish drive in Godfrey Phillips is unmistakable. A recent surge past the Rectangle pattern underscores its promising bullish trajectory.
Last week's positive shift in the stock was anchored by the 12-week EMA, which corresponded with a reevaluation of the Rectangle pattern, marking the onset of a bullish trend.
Furthermore, the weekly RSI charts have broken out, highlighting a strengthened momentum in its ongoing trend.
Going ahead, we expect the prices to move higher till Rs 2,400 where the stop-loss must be Rs 2,010 on the closing basis.
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