Rajesh Palviya
On the weekly chart, Nifty has formed a bearish candle similar to Hammer followed by Doji candle to the previous week. Since the last six days, Nifty is trading in the range of 11,700-11,550 indicates consolidation in the near term. Nifty is holding its 20 and 50 DMA which indicates index holding bullishness on short term chart.
The chart pattern suggests that if Nifty crosses and sustains above 11,680 level, it would witness buying which would lead the index towards 11,730-11,760 levels. However, if the index breaks below 11,550 level, it would witness profit booking which would take the index towards 11,500-11,470.
Nifty has the highest PE concentration at 11,500 followed by 11,600 which may act as support for current expiry.
Nifty Call strike 12,000 followed by 11,800 witnessed significant OI concentrations and may act as resistance for current expiry.
If Nifty manages to cross above 11,760, then short covering action can be seen in market and Index may scale up towards 11,850-11,900.
The weekly and daily strength indicator RSI and momentum oscillator Stochastic are below their respective reference lines indicating negative bias. We expect Nifty to trade in the range of 11,500-11,800 for the coming week.
Bank Nifty:
On the weekly chart, Bank Nifty has formed a small bearish candle with a lower high compared to the previous week indicating losing strength. Since the last 5-6 days, Bank Nifty is trading in the range of 29,650-30,100 indicates sideways momentum.
Bank Nifty has the highest PE concentration at 29,500 followed by 29,800 while Bank Nifty Call Strike 30,000 followed by 30,200 witnessed significant OI concentration and may act as resistance in coming days.
Chart pattern suggests if Bank Nifty breaks below 29,700 then we may witness more profit booking which could drag it towards 29,500-29,400 in short term, while above 30,200, we may witness short covering action which could take it towards 30,500-30,700 on the higher side.
The weekly and daily strength indicators are in positive territory while momentum indicators stochastic has given negative crossover to its reference line, indicating some profit booking or consolidation in near term. We expect Bank Nifty is expected to trade in the range of 29,500-30,100 in the coming week.
Here are the four stocks which could give 7-11 percent return:
Ashok Leyland | Buying Range: Rs 96-94 | Stoploss: Rs 90 | Target: Rs 103-106 | Upside: 11 percent
On the daily chart, the stock has observed "Cup & Handle" formation breakout at Rs 95 levels on closing basis. This breakout is accompanied by rising volumes which shows increased participation. The stock price is sustaining well above its 20, 50 and 100 day SMA which supports bullish sentiments ahead. The weekly, as well as daily strength indicator RSI and the momentum indicator Stochastic, both are in positive territory which supports upside momentum to continue in near term.
BHEL | Buying Range: Rs 77-76 | Stoploss: Rs 72 | Target: Rs 84-86 | Upside: 11 percent
On the daily chart, the stock has decisively broken its multiple resistance zone of Rs 76 levels on closing basis. Prices continue to form a series of a higher Top and higher Bottom formation indicating sustained uptrend.
The stock is well placed above its 20, 50 and 100 day SMA which supports bullish sentiments ahead. The weekly, as well as daily strength indicator RSI and the momentum indicator Stochastic, both are in positive territory which supports upside momentum to continue in near term.
ITC | Buying Range: Rs 307-304 | Stoploss: Rs 299 | Target: Rs 324-328 | Upside: 7 percent
With current close, the stock has decisively broken out its 6-8 months consolidation (Rs 303-270 levels) with hug volume spurt. The stock is in an uptrend as it continues to form a series of a Higher Top higher Bottom formation.
The stock is well placed above its 20, 50 and 100 day SMA which supports bullish sentiments ahead. The weekly, as well as daily strength indicator RSI and the momentum indicator Stochastic, both are in positive territory which supports upside momentum to continue in near term.
Tata Motors DVR | Buying Range: Rs 103-100 | Stoploss: Rs 95 | Target: Rs 110-113 | Upside: 9 percent
On the daily chart, the stock has witnessed a shift of trend to upside and also it has decisively broken out past four months multiple resistance zone of Rs 98 levels on closing basis. On the weekly chart, the stock has also given a down sloping Trendline breakout at Rs 97 levels.
The stock is well placed above its 20, 50 and 100 day SMA which supports bullish sentiments ahead. The weekly, as well as daily strength indicator RSI and the momentum indicator Stochastic, both are in positive territory which supports upside momentum to continue in near term.
(The author is a Head - Technical & Derivatives Research at Axis Securities)
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