After losing 5.3 per cent from record high level, Nifty50 commenced the truncated week on a positive note. Even during the intraday decline, it defended the level of 17,700 and eventually ended at 17,930, up 1.5 per cent. Recovery from the 50-day moving average ensures immediate floor near 17,600 levels, however, 18,050-18,100 are likely to act as a resistance zone. In short, after two weeks’ decline, mild consolidation in Nifty50 is possible.
Bank Nifty, meanwhile, has lost 8 per cent from the recent high. In today’s trade, Bank Nifty opened above the mid-point of the previous bearish candle and closed near Friday’s high. Considering immediate support near 39,100, Bank Nifty may revisit 40,000-40,300 zone.
Broader indices also saw positive traction and sustenance could attract stock-specific rally within the mid-small cap space.
Recommendations
Buy Jamna Auto near Rs 98
Stop loss: Rs 94
Target: Rs 106
Series of ascending tops and bottoms remain intact. Sustenance above important averages is likely to keep the near term outlook positive.
Buy Coal India near Rs 170
Stop loss: Rs 165
Target: Rs 181
After losing nearly 20 per cent, renewed buying interest has emerged in stock near 50-day average. Positive follow-up action is likely to lift the stock towards Rs 181.
(Amit Trivedi, CMT, is Technical Analyst – Institutional Equities, at YES SECURITIES)
