If Nifty continues to trade below 15,600, it may touch 15,510; HCL Tech, Sun Pharma look strong on charts

June 02, 2021 8:56 AM

The larger texture of the market is still on the bullish side and likely to continue in the near term, said an analyst

HCL Tech, Sun Pharma, Asian painst, niftyFor the market, the immediate hurdle would be 15700/52300. Image: Reuters

By Shrikant Chouhan

After a strong uptrend rally from 14885 to 15660, the benchmark indices witnessed a narrow range activity near an all-time high level. However, the larger texture of the market is still on the bullish side and likely to continue in the near term. Among sectors, the move of the Nifty IT Index is encouraging and we suggest accumulating technology stocks for this month. The Nifty 50/ Sensex 30 Index has closed below 15600/52000 which indicates day traders may take a cautious stance near all-time high level, and if the index manages to trade below 15600 then the Nifty may visit the levels of 15510/51750 to 15450/51500. On the flip side, for the market the immediate hurdle would be 15700/52300, trading above the same we can expect the continuation of the uptrend wave up 15770/52500 or 15850/52800 levels.

Stocks in focus this week

Adani Ports and Special Economic Zone

BUY, CMP: Rs 798.5, TARGET: Rs 840, SL: Rs 780

Past few weeks Adaniports was trading in a tight range with a higher low series formation, meanwhile, on the daily scale, the stock has given a breakout of the Ascending Channel chart pattern with incremental volume activity which indicates the beginning of a new up move in the counter.

Sun Pharmaceutical Industries

BUY, CMP: Rs 671.15, TARGET: Rs 705, SL: Rs 655

The stock had been in a phenomenal uptrend from the lows of 550 forming a bullish continuation chart patterns, presently due to some profit booking a temporary pause in the momentum is seen however it seems that a strong reversal is very likely from the retracement zone on the daily chart for further upward movement.

HCL Technologies

BUY, CMP: Rs 951, TARGET: Rs 999, SL: Rs 930

There is a good base which is formed around 900 which will act as a strong support area for the counter, additionally, after the reversal, the stock is in a gradual up move and trading in a rising channel well above its short-term moving averages, hence we expect bullish momentum to sustain in the near future.

Asian Paints

SELL, CMP: Rs 2,924.95, TARGET: Rs 2,780, SL: Rs 2,980

The stock has made an all-time high of 2989 and it seems that the bulls are losing the pace for further upside movement as seen on intraday charts where after the consolidation the stock came on the downside by breaking its short-term moving averages indicating further bearishness.

(Shrikant Chouhan is Executive Vice President (Equity Technical Research), Kotak Securities. Views expressed are the author’s own.)

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