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The Nifty closed with a loss of 15 points at 10,410 near its 100-day exponential moving average (DEMA) on Wednesday. But, the big takeaway was that bulls managed to narrow losses towards the close of the session.
In last five sessions, Nifty has retraced 61.8 percent of earlier six days fall, indicating weak pullback, and suggesting a round of a couple of day’s consolidation in a range of 10,300–10,450 levels.
The Nifty witnessed a symmetrical and V-shaped recovery in the second half. Technically, nothing has really changed from Monday onwards. Till last week, the markets seemed pretty balanced but with a slight negative bias.
“The current up-move puts the bulls at a slight advantage. However, the same needs to be taken with a pinch of salt. The markets have recovered from the 200 DMA placed at 10131, and the recovery seems to now eyeing the 100 DMA,” GEPL Capital said in a report.
“The pull-back indicates a bit of respite from oversold territory and that has to be considered with a bit of skepticism. CAUTION is the name of the game with a wait and watch, the precursor,” it said.
Analyst: Dharmesh Shah – Head Technical at ICICI Direct.com Research
Titan Company: BUY| CMP Rs865| Target Rs1048| Stop Loss Rs768| Return 21%| Time Frame 6 months
The stock witnessed a strong rally in the CY17 rallying from a low of Rs297 to its all-time high of Rs824. In the process, the stock witnessed a faster retracement of its last major decline as the 22-month decline was completely retraced in just seven months.
At present, the stock confirmed the rising channel breakout (containing the entire price activity since March 2011 till date) by retesting it on the monthly chart, signalling a structural turnaround in favour of the bulls on the long-term chart.
Considering the robust price structure, ICICIdirect expects the stock to continue its current uptrend and head towards Rs1048 in the medium term where current up move from December 2017 low of Rs773 would achieve price parity with the previous major rally from Rs564 to Rs839.
Godrej Properties: BUY| CMP Rs758| Target Rs850| Stop Loss Rs715| Return 12%| Time Frame 1 months
The share price of Godrej Properties was consolidating in a broader range of 728–859 over two months. During two months consolidation, the stock has taken support from the gap area on January 8, 2018, on multiple occasions, indicating sturdy base formation around 728.
Currently, it registered a breakout from falling trend line is drawn adjoining subsequent high of 912–849 supported by above average volumes, indicating termination of an intermediate correction. Among oscillators, RSI found support from one-year long support base of 35 and pointing upward, confirming base formation.
The stock is likely to head higher in the near-term towards 850 as it is the placement of identical highs coinciding with an upper band of broader consolidation range of 859 - 728.
NCC: BUY| CMP Rs126| Target Rs147| Stop Loss Rs115| Return 17%| Time Frame 1 months
The share price of NCC has undergone a secondary phase of correction, in which it found support from 102 levels as it is the 61.8% of the last leg of the rally from September 2017–January 2018 of 81–141, placed around 104, corroborating with 200 DMA placed at 104
On the oscillator front, RSI indicator has been inching upward, indicating inherent structural strength, augur well for next leg of up move.
The stock is likely to head higher in the near-term towards 147 being the 123% external retracement level of the current decline, while support remains near 50% retracement level of current up move around 115.
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