Support shifts higher to 10,100 in March expiry which is positive for bulls

The Indian equity benchmarks Nifty50 and the S&P BSE Sensex managed to close in green for two consecutive trading sessions on the back of improving global sentiments as trade war fears eased.

Traders also took positive cues from the surprise cut in the government's borrowing programme for the next financial year.

After a gap up opening, Nifty traded flat for most of the day and managed to close above its 200-DMA (10,178) with gains of 0.53 percent at 10,184.15; forming a Doji Candle pattern on the daily scale.

The Relative Strength Index – RSI on the Daily Chart is at 43.78; is in neutral zone with no divergence against the price and MACD is continuously sustaining below zero line but trying to crossover the signal line, which indicates that the bias could remain range-bound before the expiry.

On the option front, Maximum Call open interest of 46.04 lakh contracts is seen at strike price 10,200, followed by 10,500, which now holds 43.84 lakh contracts and maximum Put open interest of 48.26 lakh contracts is seen at strike price 10,000, followed by 10,100 which now holds 40.60 lakh contracts.

As per the option data, the support level in Nifty has shifted higher in the March expiry compared to last week and the immediate support is seen around 10,100 mark whereas 10,200 will act as hurdle before March expiry.

The India VIX ends up by 2.34 percent at 15.55 and is still trading above the crucial mark of 15 which indicates mild (intraday) volatility to remain in coming trading sessions.

Bajaj Finance Ltd: Buy | Close: Rs 1772.45 | Target: Rs 1960 | Stop loss: Rs 1650 | Return: 10.58%

The stock has given a consolidation breakout above Rs 1740 level in the weekly scale after taking support around its 50-DMA.

The weekly Relative Strength Index (RSI) is showing upward momentum and the MACD is sustaining above the zero line and is trying to crossover the signal line whereas OBV — On Balance Volume continuously trading in a positive channel, which indicates that the stock has potential to move higher from current level.

Positional traders can buy the stock around current level and add on dips around Rs 1745-1755 with a stop loss below Rs 1650 (closing) for a target of Rs 1960.

UPL Ltd: BUY | Close: Rs 736.80 | Target: Rs 800 | Stop loss: Rs 699 | Return: 8.55%

The stock has given a consolidation breakout on Tuesday above Rs 733 level with higher volume in daily scale. The Relative strength index (RSI) has given positive crossover and MACD continuously trading with positive crossover whereas +DI trading above -DI.

Traders can buy the stock in the range of Rs 730-737 with a stop loss below Rs 699 (closing) for the target of Rs 800.

Balkrishna Industries Ltd: Buy | Close: 1095.15 | Target: Rs 1200 | Stop loss: Rs 1050 | Return: 9.59%

The stock has given a breakout from symmetrical triangle pattern above Rs 1085-1090 levels on Monday with higher volumes in the daily scale.

The Daily Relative strength index (RSI) showing upward momentum and +DI continuously trading above -DI whereas MACD trading with positive crossover.

Based on the above mentioned observations traders can buy the stock in the range of Rs 1085-1095 with a stop loss below Rs 1050 (closing) for the target of Rs 1200.

Zee Entertainment Ltd: Buy | Close: Rs 586.50 | Target: Rs 638 | Stop loss: Rs 560 | Return: 8.69%

In daily scale, ZEEL has taken support around its 200-DEMA and bounced back with higher volumes, which suggest that the stock has made a temporary bottom around Rs 550 levels.

The Daily Relative strength index (RSI) showing upward momentum and MACD trading with positive crossover around zero line, which indicates the stock price has potential to move higher.

Traders can buy the stock in the range of Rs 580-587 with a stop loss below Rs 560 (closing) for the target of Rs 638.

LIC Housing Finance Ltd: Buy | Close: Rs 552.10 | Target: Rs 620 | Stop loss: Rs 512 | Return: 12.12%

The stock has given consolidation breakout on Monday with moderate volume in weekly scale. Weekly Relative strength index (RSI) making higher bottom while MACD has given positive crossover and are in Buy mode, which indicates that the stock price has a potential to move higher.

Traders can buy the stock around current level and also add on dips around Rs 535-540 with a stop loss below Rs 512 (closing) for the target of Rs 620.

Disclaimer: The author is Research Analyst, Guiness Securities. The views and investment tips expressed by investment experts on moneycontrol.com are his own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.