Jaydeb Dey
The Nifty on Thursday ended 0.37 percent up at 10,565.30. The index remained within a tiny range for the entire session, before ending on a flat note with a Doji candle. It continues to face resistance on every rise around a cluster of resistances placed around 10,570 and 10,600.
Chart patterns suggest that the Nifty breaking out 10,600 is unlikely as of now. Hence, staying cautious on a rise is advised. Downside supports are placed around 10,510 and 10,460. Weakening rupee is also a major threat.
On the Nifty hourly chart, negative divergence in the RSI pattern is still intact, which may continue to build selling pressure around 10,570 and 10,600 levels. Hence, buying is not advised at this juncture.
Nifty patterns on multiple timeframes show it has remained sideways for the entire session before ending the day on an indecisive note. Hence, the possibility of Nifty getting into a corrective down move within the broader uptrend is still alive.
The Bank Nifty previous day ended 0.1 percent up at 25,126.15. Ending the session with another bearish Marubozu candle suggests it may continue facing resistance on a rise of around 25,250 and 25,400. Downside supports are placed around 25,000 and 24,800.
Based on a thorough technical study, the research firm recommends a sell on Oriental Bank of Commerce which can deliver up to 8% return in the short-term:
Oriental Bank of Commerce | Rating: Sell | Target: Rs 87 | Stop loss: Rs 99 | Return: 8%
The stock on Thursday ended with a symmetric triangle pattern breakdown. It is currently trading below the 30 EMA on the daily chart with a rising open interest, which implies that the stock may once again come down to Rs 87. Based on the above mentioned observations, the house recommends OBC as a sell on a rise for the short-term downside target of Rs 87.
Disclaimer: The author is Technical Analyst at Stewart & Mackertich Wealth Management. The views and ideas expressed above may have been suggested to the clients of Stewart & Mackertich Wealth Management. It is advised that investors/traders should consult with their Certified Experts before taking any investment decision.
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