Abhilash , Assistan V-P, Edelweiss Alternative Research
Is 16,000 on the cards for Nifty this week?
At the current juncture heavyweights are in overbought territory and a majority of this rally has come on a slowed-down momentum. Now, only if Nifty defensively settles above the 15,950 level, the index can rise towards 16,150. The 15,750 level will act as a cushion in case of any minor degree dip and medium-term support lies at 15,350.
What should investors do?
Within Nifty there will be sectorial level rotations and we expect underperformance from the banking index as Bank Nifty has significant resistance at 36,000; meaningful upsides would happen only if the Bank Nifty is able to take out this level. Traders can initiate short strangle option strategy in Nifty by selling 15,700 put and 16,150 call for July 22 weekly expiry. Among stocks, MCX can be bought for a 25% upside/10% stop loss for the next 3-4 months as the price has exceeded the falling channel pattern with a bullish candle on a volume surge — indicating strong breakout.
Rahul Sharma, Head, Techniical & Derivatives Research, JM Financial
Is 16,000 on the cards for Nifty this week?
Last week was the third week when Nifty found support at the 15,630-15,650 zone; and in the entire consolidation of the past six weeks, this is the first time it has shown early signs of ending this range-bound movement. Options data suggest a range of 15,840 to 16,050, and one can expect Nifty to challenge the upper band this week. Bank Nifty could witness short-covering if 36,000-36,200 resistance is taken out with next resistance in sight at 37,000 level.
What should investors do?
Focus will be on realty, metal and pharma. Add Nifty futures on dips near 15,780-15,800 for a target of 15,925 and 16,000 with a stop-loss at 15,690. It will be worthwhile to note if volumes expand near the 16,000 mark, as a failure to do so may attract shorting interest at higher levels. Technically, Coforge is relatively strong and momentum traders can expect ?4,750 to ?4,800 being tested on the upside while the support of ?4,450 can be a stop-loss.
Gaurav Bissa, V-P Technicals & Derivatives, LKP Securities
Is 16,000 on the cards for Nifty this week?
Nifty has been consolidating for the past few weeks and finally gave a breakout. As long as the index manages to stay above 15,875 levels, it has a strong chance of crossing 16,000 levels and can also test 16,100-16,150 in the coming weeks.
What should investors do?
One can buy Nifty futures above 15,970 for a target of 16,150-16,200 with stop loss at 15,890. Futures hourly chart is seeing a re-test and once prices make a new swing high, the pace of upmove is expected to increase. Investors and traders need to select good quality midcaps which are showing retest on longer-term charts and choose outperforming sectors which provide higher chances of success such as metal and pharma. Among metal stocks, we like SAIL and Jindal Steel. They could see another 8-10% upside. In the pharma space, stocks like Lupin and Aurobindo Pharma look strong for another 8-10% upside based on the breakout re-test pattern.
