Rahul Sharma, Head, Technical & Derivatives Research, JM Financial
Is the Nifty likely to hit record highs soon?
Market internals have improved drastically along with the breakout and a new all-time high is a matter of time for the Nifty given the current setup. Options concentration has shifted to 15,000 Puts and 15,500 Calls. Huge built up was seen in 15,000 and 15,100 Puts on Friday with a decline in Implied Volatility, indicating writing. The next targets for the Nifty are 15,400 and 15,900 while the Bank Nifty could aim for 35,900 and 38,000.
What should investors do?
One can accumulate longs in intraday dips for an upside target of 15,400 by this expiry. 15,000 should be stop-loss on a closing basis. Nifty 27 May 15,200 Calls can be bought around Rs 100 for a target of ?200 by expiry and stop-loss at Rs 50. A lot of private banks have turned around from crucial short-term averages and can be added on the long side.
What is your view on SBI after the quarterly result?
SBI has crossed its resistance zone of ?395-400 with mega volumes and has closed above it on the back of quarterly numbers. Technically, the stock remains bullish for ?450 target in the next 1-2 months and stop-loss can be placed at ?380. The rub-off can be seen on other PSU bank stocks which can deliver an immediate upside along with the broader market.
Gautam Shah, Founder & Chief Strategist, Goldilocks Premium Research
Is the Nifty likely to hit record highs soon?
The markets have climbed a “wall of worry” really well in the recent past. The index has completed a well behaved three-month-long consolidation and seems to have broken out in the last week. We see continuing strength towards 15,350-15,400 in the near term. Over the medium-term, a test of 16,000 is on the cards as well. The base is now around the 14,700 level with near term support at 14,950.
What should investors do?
We see the banking and auto sectors take leadership from current levels. Pharma remains in a strong structural uptrend and the index looks on course for 14,700-15,000. We see the unlock trade playing out as well and so hotel, airlines, insurance and entertainment stocks offer excellent risk-reward based opportunities at current levels.
What is your view on SBI after the quarterly result?
The fabulous results and the excellent chart set-up call for significant upside from current levels. The stock has exhibited relative strength in the recent past while the banks went through a correction. We see the stock move back to life highs and beyond. The downside is limited while the upside is completely open. This along with
are our best picks in the sector.
Abhilash Pagaria, Senior Manager, Edelweiss Alternative Research
Is the Nifty likely to hit record highs soon?
The undertone of the markets is very bullish and we may head towards new highs and any decline should be used as an opportunity to add positional longs. The index has immediate supports at 14,900 and has formed a higher base around 14,400 and 14,500. Interestingly, the momentum in midcaps and smallcaps is very strong and they are well placed to outperform the heavyweights.
What should investors do?
We may see some bout of volatility as it is the monthly F&O expiry. Through options, one can play a simple bull call spread by buying 15,200 Call and selling 15,550 Put of Nifty. On May 27 we also have MSCI Semi-Annual Rebalance which will lead to strong inflows in Adani Transmission, Adani Gas,
, SBI Cards, CIFC and BEL. On the other hand, a contra bet — looks good for a 7-8% upside as it is well placed at multiple supports and is also displaying some price strength.
What is your view on SBI after the quarterly result?
After Friday’s close, the derivative positioning is strongly tilted on the long side and with across the board upgrades by broking houses, the stock is well placed to touch Rs 450 in the next few weeks.
