The Nifty closed at 22,327 with a respectable gain of over a percent for the week ended March 28. A bullish sentiment prevailed on the market throughout the week, reflecting an overall improvement in the broader market mood. The correction observed in mid-March appears to have concluded, with prices closing above the key resistance levels, signalling a resumption of the primary uptrend.
Additionally, the RSI Smoothened indicator that recently witnessed a dip has turned northward and hints at a fresh 'buy' call.
Going ahead to the week starting April 1, close attention will be paid to the all-time high levels above 22,500, as hesitation was evident at these levels. A sustained trade or close above this point would confirm the resumption of the primary uptrend, potentially triggering a further rally in April.
Conversely, buying on dips remained a notable pattern during the week, suggesting that 22,200 serves as an immediate support, while 22,000 and 21,700 represent subsequent key support levels. Notably, 22,500 and then 22,680 stand as significant hurdles on the upside.
Traders are advised to monitor these levels closely and adjust their strategies accordingly.
While midcap and small-cap sectors showed improvement during the truncated week, the primary contribution came from heavyweight stocks. Going ahead, although the uptrend may continue, traders must exercise selectivity in their approach, as index management is anticipated.
Here are two buy calls for the short term:
ICICI Prudential Life Insurance Company: Buy | LTP: Rs 609 | Stop-Loss: Rs 579 | Target: Rs 670 | Return: 10 percent
Over the past two years, stock prices have consistently encountered substantial resistance around Rs 600 level. However, they have now decisively breached this barrier, confirming a robust breakout known as the 'Inverse Head and Shoulders' pattern. This breakout, evident on the weekly chart, is accompanied by a notable increase in trading volume and the presence of strong bullish candlesticks.
Furthermore, the daily chart indicates a compelling moving average crossover, with the 50-day EMA (exponential moving average) surpassing the 200-day SMA (simple moving average) from below. Taking into account these technical parameters, we hold a firmly bullish outlook on this stock.
Hence, we recommend buying ICICI Prudential at around Rs 609 - 600, with a stop-loss of Rs 579 and target of Rs 670.
Piramal Pharma: Buy | LTP: Rs 129 | Stop-Loss: Rs 123 | Target: Rs 138 | Return: 7 percent
Following a robust surge from Rs 88 to Rs 149, the stock experienced a healthy correction over the past few months. However, after retracing approximately 50 percent of this rally, prices have begun to exhibit positive momentum once again.
Notably, the recent correction occurred on low volumes, while upticks have been accompanied by comparatively higher volumes, indicating accumulation in this stock. Moreover, prices have closed above the 20, 50, and 89 EMA on a single daily candle, a rare and strong bullish signal.
Additionally, the momentum oscillator RSI (relative strength index) has recently issued a buy signal in the oversold zone, further supporting the bullish outlook. Considering all these factors, we maintain a positive stance on the stock.
Hence, we recommend buying Piramal Pharma at around Rs 129 - 127, with a stop-loss of Rs 123 and target of Rs 138.
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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