The bulls are back with vengeance on January 9 after three days of selling in the markets. At close, the Nifty was up 242 points or 1.35 percent at 18,101 level.
The short-term trend in the Nifty turned positive as the index closed above its 5-day and 11-day EMA (exponential moving average). The Nifty open interest Put Call ratio surged to 0.98 level from 0.75 level on the back of aggressive Put writing at 18,000-18,100 levels.
For the last three weeks, the benchmark index has found support in the range of 17,774-17,800, which happens to be the upward sloping trend line, adjoining March 2020 and June 2022 bottoms. Therefore, on the downside, 17,800 could now be considered as an immediate support for the Nifty and one should remain bullish with stop-loss of Rs 17,800 level.
On the upside, 18,200-18,265 could act as an immediate resistance for the index. We may see upside momentum once it manages to surpass recent swing high of 18,265 convincingly.
The Nifty Smallcap 100 index is trading in the horizontal channel with both double-top and double-bottom formation. This indicates the ongoing consolidation and stock-specific action in the market.
More than 50 percent of stocks in the market are trading above their 200 DMA (day moving average) from NSE500 Group, which indicates strength in the midcap/smallcap stocks. We believe that midcaps/smallcaps could do well in the coming weeks.
Here are three buy calls for next 3-4 weeks:
Hitachi Energy India: Buy | LTP: Rs 3,325 | Stop-Loss: Rs 3,150 | Target: Rs 3,560-3,650 | Return: 10 percent
Accumulation was seen in the stock from the month of December where volumes are higher on up days as compared to down days. Primary trend of the stock is positive as stock price is trading above its 100 and 200-day moving averages.
Momentum oscillators - RSI (relative strength index - 11) and MFI (money flow index - 10) is sloping upwards and placed above 50 on the daily chart, indicating relative strength in the stock.
After breaking out on the daily chart on December 12, the stock price is consolidating which we believe is a buying opportunity. One can buy the stock in the range of Rs 3,347-3,250.
Sundram Fasteners: Buy | LTP: Rs 1,001 | Stop-Loss: Rs 930 | Target: Rs 1,080-1,130 | Return: 13 percent
The stock price has broken out on the weekly chart from the multiple top resistance of Rs 980-985 levels. Short term trend of the stock is positive as stock price is trading above its 5 and 20-day EMA (exponential moving average).
Momentum Oscillators - RSI (11) and MFI (10) is sloping upwards and placed above 60 on the weekly chart, indicating relative strength in the stock.
Auto ancillaries’ stocks are looking good on the short and medium-term charts. One can buy the stock in the range of Rs 1,001-970.
Minda Corporation: Buy | LTP: Rs 219.80 | Stop-Loss: Rs 205 | Target: Rs 235-246 | Return: 12 percent
The stock price has broken out from the downward sloping trendline on the weekly chart. It has been taking support at 200-day EMA. Intermediate trend of stock remains positive as it is trading above its 50, 100 and 200-day exponential moving averages.
Auto ancillaries' stocks are looking good on the short to medium-term charts. One can buy the stock in the range of Rs 219.80-215.
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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