Traders are advised to avoid long side bets and can consider positional shorts, with a stop above 12,035 on the closing basis, says Mazhar Mohammad
Mazhar Mohammad advised traders to remain neutral on index and should focus more on stock specific opportunities.
Experts expect the consolidation to continue in the near term unless the index sees a strong breakout on either side for a directional move.
Mazhar Mohammad has advised traders to remain neutral on the long side till the Nifty closes above 11,990 levels.
The Nifty50, which opened at 11,928, rose to an intraday high of 11,989 before closing the day at 11,941.
Nifty has support near 11,500-11,600 and resistance at 11,975 where the upper Bollinger band stands at.
Stock specific positive set up in Tata Steel, Axis Bank, Tech Mahindra, Grasim, State Bank of India, Bank of Baroda, selective PSU Bank, Metal stocks
If Nifty crosses and sustains above 11,950 levels it would witness buying which would lead the index towards 12,000-12,100 levels
Target as per Double Bottom pattern is calculated by adding height of trough to resistance line which comes to Rs 440
Traders can expect the breakout in the stock which will lead to increase in Vega and Delta in the option premium whereas Theta decay will play a very minor role
It has been a bumpy journey, especially for short-timeframe traders. However, on weekly charts, I am bullish and the Nifty may attempt a fresh high next week.
If Nifty manages a strong close above 11,950 levels then it may head to test life time highs placed around 12,103 levels but that rally, if unfolds before proper correction, should be short lived, Mazhar Mohammad said.
Mazhar Mohammad has advised traders to book profits in long positions either on a rally beyond 11,950 or if the index it trades below 11,855 levels.
The new short term base is now emerging at 11,700 level and until we are trading it, buying on dips will remain the prudent strategy for traders.
Mazhar Mohammad has advised traders to create fresh longs by making use of dips into the 11,750–11,700 zone.
Mazhar Mohammad advises traders to either create fresh longs on close above 11,800 levels or on dip into the zone of 11,740–11,720 levels.
The weekly strength indicator RSI and momentum oscillator Stochastic have both turned positive and are above their respective reference lines indicating positive bias.
A market which is going through a time-wise corrective phase is bound to provide whipsaw movement. So we should be ready for the days where benchmark indices won't have follow-on moves.
BHEL has also given a descending trend line breakout and it has retraced back to touch the trend line, looking at flip property, this trend line should provide strong support and prices should trade higher towards previous swing high placed around Rs 57.50 levels.
Traders in next Tuesday's session can look to create fresh short positions if Nifty trades below 11,490 levels for more than 30 minutes with intraday high as stop and look for a target of 11,490, said Mazhar Mohammad, Chief Strategist – Technical Research & Trading Advisory, Chartviewindia.in.
Options data suggests that the Nifty could trade in 11,500-11,800 range.
Mazhar Mohammad advised traders to wait for a breakout above 11,700 levels and meanwhile they should shift their focus on stock specific opportunities.
Amit Shah of Indiabulls Ventures said index has risen from the levels of 11,100 to 11,700 zone and few days of consolidation cannot be ruled out going ahead.
Mazhar Mohammad advised traders to hold their long positions with a stop below 11,553 on closing basis and should book profits close to 11,770 levels.
Mazhar Mohammad advised traders to create fresh long positions in index with a stop below 11,430 on closing basis and look for initial targets placed around 11,800.