ABHILASH PAGARIA
SENIOR MANAGER, EDELWEISS ALTERNATIVE RESEARCH
Nifty has gained for two consecutive weeks, where is the index headed now?
The underlying trend is strengthening in favour of the bulls; and in the process, Nifty decisively took out the 50-day moving average. This week we may trade in a broader range of 14,500 and 15,080; one can look to short the index at 15,100 with 15,160 as a stop loss and simultaneously buy around 14,500 with 14,420 as a stop loss. The market has very strong support at 14,160 and that looks unlikely to be broken unless the current pandemic situation worsens.
What should investors do?
This week we will see strong momentum in potential MSCI Index inclusion stocks which will be announced on May 12. Our high-conviction inclusion names are Adani Enterprises, Adani Total Gas and Adani Transmission while medium conviction inclusion names are
Cards and Cholamandalam Investment. , PowerGrid and BEL have strong upward momentum. Auto stocks and reopening trades (PVR and IndiGo) will be laggards. Any market-led weakness in metal stocks should be bought into as there is still one leg of rally left and fundamentals are strong for the entire sector.
ROHIT SRIVASTAVA
FOUNDER, INDIACHARTS.COM
Nifty has gained for two consecutive weeks, where is the index headed now?
I do not see the Nifty going below the recent low of 14,150 and that should be the bottom for now. Volumes remain poor because of this; however, stock specific and sector specific activity has been strong as value buying continues in some places and this has led to strong advances to declines ratio meaning more stocks are going up than going down.
What should investors do?
In the near term, investors could stick to the stronger sectors or themes like metals, small caps, public sector enterprises, and healthcare, which have shown above average performance. While it may appear that metals have gone up too much, it is a strong trend and might not be over. Public sector stocks are rising slowly after a deep correction and are the dark horse and ideal for longer-term investors who are looking for value
PRITESH MEHTA
LEAD TECHNICAL ANALYST -INSTITUTIONAL EQUITIES, YES SECURITIES
Nifty has gained for two consecutive weeks, where is the index headed now?
Going ahead, sustenance above 14,800 would result in a follow through move towards 15,000-15,100 zone. Yet, select index biggies and Bank Nifty are under performing. So following a sector/stock specific approach will be useful. Ratio of Nifty Midcap vs Nifty has broken out from a 2-year base, suggesting participation from midcaps.
What should investors do?
Till Bank Nifty does not show leadership, focusing on sectors showing relative strength would be the right approach. Ratio of Nifty IT versus Nifty has provided a pullback from support of its 100-day moving average. Following a phase of profit booking in April, we expect out-performance to prevail in IT stocks, especially in midcap IT names like Mindtree and Mphasis.
