Nifty closed above the level of 17,000 for the first time on August 31. The Banking index also gained some momentum and closed at its multi-week high of 36,424.60.
The market is likely to move towards 17,250-17,300, tracking strong global cues.
Technical charts suggest that the banking index may outperform in the coming sessions as Bank Nifty has managed to close above the key resistance level of 36,400.
The bias is likely to remain in favour of bulls as long as Nifty is holding above 17,000 level.
Derivatives data suggests bears are now feeling uncomfortable at the current juncture as Call writers were observed unwinding their positions while Put writers were seen shifting to higher bands and added hefty open interest at 16,900 and 17,000 strikes.
Here are three buy calls for the next 2-3 weeks:
For the last two months, this stock has been moving in a downward-sloping rising channel on daily and weekly charts.
It has been maintaining its downtrend with the formation of lower highs and lower bottom patterns.
At the current juncture, this stock has taken support at its 200-day exponential moving average on the daily charts and given a V-shape recovery, regaining momentum above Rs 1,300.
Additionally, it has given a breakout above the falling trendline of the channel. Traders can accumulate the stock in the range of Rs 1,330-1,355 for the upside target of Rs 1,490.
Canara Bank | LTP: Rs 158.65 | Target price: Rs 177 | Stop loss: Rs 147 | Upside: 12%
For almost the last ten weeks, this stock has been hovering in a broader range of Rs 145-165, holding well above its 200-day exponential moving average on the daily charts.
This week, this stock has given a breakout above the rectangle pattern after a prolonged consolidation.
The price-volume action is also well supported for the next up leg in the prices. Traders can accumulate the stock in the range of Rs 158-159 for the upside target of Rs 177.
This stock has formed a double bottom pattern on the daily charts around Rs 470 level and given a sharp recovery in a short span of time.
On the broader charts, it has given a breakout above the falling trendline of the downward sloping channel.
Rising volume with rising price suggests a long build-up in the stock as secondary oscillators hint at positive divergences on the short-term charts.
Traders can accumulate the stock in the range of Rs 545-555 for the upside target of Rs 622.
(The author is Senior Technical Analyst at SMC Global Securities)
Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
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