Buy Bata, ONGC, HDFC Life for near-term gains; Nifty support at 17150, charts signal more weakness | The Financial Express

Buy Bata, ONGC, HDFC Life for near-term gains; Nifty support at 17150, charts signal more weakness

The texture of the market is weak and the correction wave is likely to continue till 16850-16800 in Nifty, and 56900-56700 in BSE Sensex

Buy Bata, ONGC, HDFC Life for near-term gains; Nifty support at 17150, charts signal more weakness
Long bearish candle on daily charts and lower high formation on intraday charts indicating further weakness from the current levels in NSE Nifty 50

By Shrikant Chouhan

The benchmark indices corrected sharply, the Nifty ended 257 points lower while the BSE Sensex was down by 844 points. Among sectors, all the major sectoral indices were traded in the red, but the realty index lost the most, shedding over 3 per cent. Technically, after muted opening indices corrected sharply and breaches the important support level of 17150/57700. Post breakdown it intensified the weak momentum. Long bearish candle on daily charts and lower high formation on intraday charts indicating further weakness from the current levels. We are of the view that the texture of the market is weak and the correction wave is likely to continue till 16850-16800/56900-56700. On the flip side, 17050 in NSE Nifty, and 57350 in BSE Sensex would be key intraday resistance zones, above which, minor pullback rally possible till 17100-17125/57500-57600.

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Technical stocks to buy

Bata India
BUY, CMP: Rs 1,810.3, TARGET: Rs 1,900, SL: Rs 1,770

The counter had been in a downtrend in the past many sessions. However, at present there is a pause in its downward movement due to its strong multiple support levels. The stock has reversed its trend from the support zone along with incremental volume activity.

Federal Bank
BUY, CMP: Rs 122.4, TARGET: Rs 130, SL: Rs 118

On the weekly scale, the counter is trading into a rising channel pattern forming the higher top and higher bottom series continuously. The strong bullish activity on the daily chart suggests that the counter is likely to maintain bullish continuation formation in the near term.

ONGC
BUY, CMP: Rs 131.1, TARGET: Rs 138, SL: Rs 128

After the sharp up move, the stock is trading in a range-bound movement well above its short term moving averages. As a result, the formation of a Flag chart pattern on the daily scale is formed which points to bullish movement to resume in the coming horizon.

HDFC LIFE
BUY, CMP: Rs 522.55, TARGET: Rs 550, SL: Rs 510

The stock has underperformed in the past few weeks and it has witnessed a downtrend. After the sharp correction from higher levels, the stock is currently trading in a range bound mode near its demand zone, which indicates accumulation at these lower levels. Therefore, upward movement from the current level is expected to resume in the coming sessions.

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(Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities. Views expressed are the author’s own.)

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First published on: 12-10-2022 at 11:07 IST