Continuing last week’s up move, Nifty surpassed 18,000 in today’s trade. After witnessing record high at 18,042, however, Nifty faced mild profit taking before settling at 17,946 – up 51 points. Following Friday’s narrow range trade, Nifty gained a positive momentum. However, the throwback thereafter eventually took the form of a bullish candle with identical upper shadow. Nifty breadth was mildly positive with 66 per cent of its components settling in green. Shifting the base higher, 17,800-17,750 levels could turn out as immediate support. Last month, Nifty experienced mild correction as it failed to sustain above 17,950 zone. Hence even going ahead, sustenance above 17,950 is necessary to gain required momentum on upside. India VIX reclaimed levels of 16. Mild higher price volatility cannot be ruled out.
Bank Nifty formed a sizable bullish candle. Sustenance is likely to unlock further upside potential in an uncharted territory. Within the banking space, public banks lacked required momentum on the upside, The PSU bank index formed an indecisive candle. Sustenance above 2,580 level is important to continue the recent uptrend.
After losing 4.5 per cent from the recent high, the FMCG index gained some positive traction. Sustenance is likely to provide buying opportunities in selected FMCG stocks.
Recommendations
| Buy at Rs 235-236
Stop loss: Rs 227
Target: Rs 250
After witnessing a 6 per cent price correction off prior months high, the stock found renewed buying interest near its 20-days’ average. Sustenance could lift the stock towards the Rs 250 zone.
| Buy 145 strike call option near 4
Stop loss: 1.4
Target: 9/12
The stock is defending its levels of 20 days ‘average. Positive follow-up to today’s bullish candle could attract positive momentum.
(The author, Amit Trivedi, CMT, is Technical Analyst – Institutional Equities, YES Securities. The views are his own)
