Nifty likely to get into a corrective downward wave; Buy Wipro, sell ICICI Bank for short term

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26 Aug, 2025 12:21

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The Nifty ended Friday 0.01 percent lower at 10,564.05. It continues to trade rangebound below the cluster of resistances placed around 10,570-10,600 for the fourth consecutive session. The day long oscillation within a tiny range led to formation of a Doji candle on the daily chart.

On the weekly chart, it ended 0.8 percent higher. The higher highs and higher lows pattern continues on the weekly chart, ending with another bullish Marubozu candle, which implies this uptrend is likely to pull ahead of its pivotal resistances placed around 10,630 and 10,700 levels. Hence, a buy-on-dips strategy is to be followed.

Ending the last trading session of the April 20 week with a Doji candle implies hesitancy among traders may persist at the start of this week. Hence, buying-on-dips is advised. Bulls may find downside critical supports placed around 10,480 and 10,420 levels very alluring.

On the Nifty hourly chart, negative divergence in Relative Strength Index (RSI) is still intact, which may continue building selling pressure on a rise around 10,570 levels. Midway resistance is placed around 10,530 levels.

Nifty patterns on multiple timeframes show it ended on an indecisive note on the last day of the April 20 week. Hence, nervousness may persist in the first half of this week. Considering the broader trend, we prefer a buy on dips strategy around critical supports placed around 10,480 and 10,420 levels.

On Friday, the Bank Nifty ended 0.73 percent lower at 24,943.85. Its immediate pivotal support is placed around 24,850 levels, followed by 24,550. The upside resistance is placed around 25,000 levels.

Based on a thorough technical study, the research firm recommends Wipro, which can deliver up to 5% return in the short-term:

The stock ended last week above its critical resistance placed around Rs 295 levels. This breakout is backed by rising RSI while the moving average convergence divergence (MACD) histogram recovered above the zero line. +DI –DI bullish crossover makes the bull case even stronger. Based on the above mentioned observations, the house recommends Wipro as a buy on dips for the short-term with an upside target of Rs 310 per share.

The stock bounced back from Rs 260 level but failed to breakout from its critical resistance placed at Rs 295 per share. This was followed by a bearish candle on the last trading session of the week. The stock is still trading below its 200 exponential moving average (EMA) on the daily chart paced around Rs 298 levels, which implies the bearish trend is not yet over.

MACD histogram on the daily chart has not recovered above the zero line yet, while –DI +DI bearish crossover on the daily chart is clearly visible. Based on the above mentioned observations, the firm recommends ICICI Bank as sell on a rise with a short-term downside target of Rs 273 per share.

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. Investors/traders should consult with their Certified Experts before taking any investment decision.