Nifty fell for the fourth consecutive session on March 7 and settled 382.20 points or 2.35 percent lower at 15,863.15. At present, Nifty is placed almost 15 percent lower from the all-time high of 18,604. Nifty Smallcap Index has already registered a fall of 23 percent from its peak.
Nifty has been forming lower tops and lower bottoms on the daily chart. It has sustained below its crucial resistance of 200-day EMA, which is currently placed at 16,703. On February 24, 2022, Nifty broke down below the multiple bottom support of 16,800 on closing basis.
Previous support of 16,800 is expected to interchange its role as a resistance going forward and therefore unless we see close above 16,800, short term trend of the Nifty is expected to remain bearish.
Directional movement index (DMI) on the Nifty daily chart indicates momentum phase in the bearish trend as average directional index (ADX) has been rising over and above 25 with –DI (directional indicator) remaining above +DI. This could result in to accelerating speed of the current down moves.
Support for the Nifty is seen in the range of 15,400-15,500, while resistances for the Nifty are placed at 16,300 and 16,800.
Positional trend of the market is bearish but at the same time short term pullbacks cannot be ruled out. Trend of metal, commodities, sugar and oil & gas indices is bullish and stocks from these sectors could be chosen for long with appropriate trading stoploss.
Here are three buy calls for next 2-3 weeks:
NMDC: Buy | LTP: Rs 153 | Stop-Loss: Rs 145 | Target: Rs 170 | Return: 11 percent
The stock has been forming higher tops and higher bottoms on the daily chart. Metal and PSE both sectors have been outperforming for last couple of weeks.
NMDC, which is part of both of these indices, has also been showing resilient moves in the current down trend of overall markets. Iron ore future prices have been soaring in international commodity markets and same could auger well for the stock like NMDC.
Balrampur Chini Mills: Buy | LTP: Rs 444 | Stop-Loss: Rs 420 | Target: Rs 480 | Return: 8 percent
The stock has broken out from the downward sloping channel on the daily line chart. Sugar sector has been showing strength for last many months and the same is expected to continue in the coming days.
Indicators and oscillators have been showing strength in the current uptrend. Stock is placed above important moving averages.
MTAR Technologies: Buy | LTP: Rs 1,881 | Stop-Loss: Rs 1,800 | Target: Rs 2,100 | Return: 12 percent
The stock has broken out from last 5 days' price consolidation. Price breakout is accompanied by rising volumes. Stock recently found support on its 200-day EMA (exponential moving average) and bounced back.
After four consecutive small "Doji" candlestick patterns, stock has formed bullish "Engulfing" pattern on the daily charts, which indicates the probable bullish trend reversal.
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