Gaining for the straight third week, the Nifty commenced this week on a gap up note. However, marking morning high at 14,480, it erased some of the intraday gains. Bulls again regained momentum on upside and Nifty registered a record high of 14,498. Eventually, Nifty’s today’s action took the form of a Doji candle pattern with relatively large lower shadow.
Appearance of this pattern at the current juncture indicates renewed buying interest on intraday decline and some indecisiveness near the 14,500 zone. Positive Nifty breadth could continue stock-specific rally, while levels of 14,300 could turn out as immediate floor for Nifty.
Snapping four sessions’ winning streak, the Bank Nifty continued to underperform. Inability to surpass Friday’s peak dragged the Bank Nifty lower. Erasing early gains, Bank Nifty ended below the 32000-mark. Sustenance below 32,000 could continue recent underperformance of Bank Nifty.
IT index continued its prior seven weeks’ uptrend, while mild profit taking is visible in the metal space.
Buy IRB Infrastructure near Rs 115-114
- Stop loss: Rs 110
- Target: Rs 125
- Recent decline found support near short-term averages and since then it is holding ground above Rs 112 levels. Positive follow through could attract some revival towards the Rs 125 zone.
Buy ONGC near Rs 102
- Stop loss: Rs 97
- Target: Rs 112
- Positive follow-up after prior week’s up move ensures shift of range on the upside. Sustenance above levels of Rs 100 is likely to keep near-term outlook positive.
Sell Kotak Bank January future near Rs 1,945-1,950
- Stop loss: Rs 1,995
- Target: Rs 1,860
- Since the past few days, the stock is going through the corrective phase as recovery remained short lived finding resistance near the Rs 1980-2000 zone. Negative follow up action could drag the stock lower till Rs 1,860 zone.
Amit Trivedi, CMT, Technical Analyst – Institutional Equities, YES Securities. Views are his own.)