Following Tuesday’s throwback from the 18100-level, Nifty opened with a downward gap in Wednesday’s trade. After marking the day’s low at 17915, Nifty50 recouped early losses to register the day’s high at 18061. Eventually, the headline index ended at 18017, down 27 points, forming an indecisive candle for the day. Nifty’s breadth turned mildly negative, while sectoral trends remained mixed. Another negative close infers an immediate hurdle for Nifty50 near 18100, hence, sustenance below the said level is likely to push the index into further consolidation between 18100-17850 zone.
Meanwhile, Bank Nifty lost about a percent. Intraday recovery remained short-lived and eventually Bank Nifty ended near the 39000 mark. A negative follow-up could open up further downside possibilities till 38700-38500 zone. After rallying 13 per cent from the recent lows, bulls took a pause in the PSU Bank index (i.e. down 2 per cent); mild consolidation is possible to digest recent gains.
The metal index underperformed as the recent recovery in the index found resistance near 5800. Negative follow-up action is likely to attract price correction in selected metal stocks.
Recommendations
Sell
November futures near Rs 3900
Stop loss: Rs 3975
Target: Rs 3750
During the recent sharp decline, the stock has broken various support levels. Inability to hold current levels is likely to attract minor correction.
Sell
November futures near Rs 2090
Stop loss: Rs 2135
Target: Rs 2000
Following the swift decline, recent recovery found resistance near Rs 2125 and throwback thereafter ensures influence of hurdle at play. A negative follow-up could drag the stock lower till Rs 2000
(The author, Amit Trivedi, CMT is Technical Analyst – Institutional Equities at YES Securities. Views are his own.)
