Nifty50 is trending lower so far this week, on course to snap its two-week winning streak. Following Tuesday’s decline, Nifty50 opened on a negative note on Wednesday. The benchmark index recovered intraday losses, however failed to sustain above 18000. During the second half of the session, Nifty50 again turned negative, and eventually, it ended below 17900-mark, down 0.56 per cent. Nifty’s breadth remained negative with 70 per cent of its components settling in red, while the sectoral trend remained mixed. On sustenance below the 18000-level, Nifty50 might revisit the 17800-zone.
Bank Nifty continued to trend lower; intraday recovery failed to surpass the level of 38500 and eventually Bank Nifty ended lower for the third straight session. Negative follow-up action may unlock further downside potential till the 37800-37700 zone.
Oil & Gas stocks remained under pressure, while the auto index continued to outperform.
Recommendations
Sell
Cholamandalam Investment and Fin November futures near Rs 630-635
Stop loss: Rs 645
Target: Rs 600
Recent swift decline ensures the influence of resistance at play. Negative follow-up action is likely to drag the stock to Rs 600 zone.
Sell
November futures near Rs 760
Stop loss: Rs 783
Target: Rs 715
Recent rally found stiff resistance near Rs 790 zone and decline thereafter is sharp. The appearance of large bearish candles warrants a negative outlook for the stock.
(Amit Trivedi, CMT, Technical Analyst – Institutional Equities at YES Securities)
