Sameet Chavan
Nifty ended last week tad above 9,200, shedding over 6 percent as compared to the previous weekly close.
Although it appears to be a sharp cut when compared to the previous week's close, the overall trading action during the week was muted.
In fact, in the last couple of trading sessions, price action was extremely lethargic and the market completely looked directionless.
Neither bulls had the strength to overcome the sturdy wall of 9,400-9,450 nor bears were dominant enough to violate the 9,100-mark.
Hence, this week, 9,450 to 9,100 remains to be an immediate range. Only a sustainable breakout on either side would confirm the next path of action.
Traders holding existing longs should maintain their positions as long as 9,100 is successfully defended.
At present, traders are advised to stay light and should ideally continue focusing on individual stocks.
Although we are completely not out of the woods when it comes to coronavirus pandemic, we remain hopeful till the time above-mentioned key support is not violated.
Once we see Nifty surpassing the higher boundary of 9,450, we would see good broad-based participation in the market.
Here are two trading ideas for the next 3-4 weeks:
Pharma stocks are buzzing, showing signs of outperformance after a phase of slumber of more than four years.
This stock as well has shown strong outperformance and recently it has rallied from the levels of Rs 388 to Rs 500.
On the daily chart, after some correction, prices seem to have resumed the uptrend by forming a bullish candlestick.
Volume analysis indicates an increase in volume during upmove as compared to volume during correction which suggests accumulation in the stock.
Prices are well above the key averages and oscillators are positively placed supporting the buy call.
This stock has confirmed a bullish continuation ‘Pennant’ breakout on the daily chart.
The said breakout is supported by a good increase in volume and a bullish candlestick pattern.
On the daily chart, prices have closed above 89-EMA which was previously acting as resistance and now indicates a change in polarity.
In addition, momentum oscillator RSI, after forming a base around 50 level, has started northward journey, supporting the bullish view on this counter.
(The author is Chief Technical & Derivatives Analyst at Angel Broking)
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