The Nifty / Sensex hovering in the range of 14600 to 14400/ 47500-49000 price range and the texture of the pattern suggest narrow range activity likely to continue in the near future.
By Shrikant Chouhan
The market registered an extremely volatile session, the Nifty/ Sensex closed 63/243 points lower. The Nifty/ Sensex failed to sustain above the 14500/48400 resistance mark and due to consistent selling pressure at higher levels along with tepid global cues the benchmark index corrected sharply. Among sectors, profit booking was seen in IT stocks whereas, Auto, Pharma and selective Media stocks witnessed buying interest.
- ONGC, HDFC Life, Bajaj Finance among top technical stocks to buy as Sensex, Nifty show weakness on charts
- RIL, Reliance Comm, Jindal Steel and Power, Dr Reddy’s, Bharti Airtel stocks on investors’ radar today
- Bharti Airtel, Jindal Steel and Power, BPCL, Axis Bank, Maruti Suzuki, ONGC, NTPC stocks in focus
We are of the view that, currently the Nifty / Sensex hovering in the range of 14600 to 14400/ 47500-49000 price range and the texture of the pattern suggest narrow range activity likely to continue in the near future. Technically, the index has formed a lower top formation which is broadly negative for the market. The intraday chart suggest correction wave likely to continue if the Nifty/ Sensex succeed to trade below 14400/48100 and below the same, the correction wave will continue up to 14200-14130/ 47350-47000 On the flip side, above 14400/48100 we can expect quick pullback rally till 14475-14525/ 48300-48500.
Jindal Steel and Power Ltd
BUY, CMP: Rs 431.55, TARGET: Rs 455, SL: Rs 420
On the daily time frame, after the sharp up move, the stock was into a consolidation phase and finally, it has given a breakout from its Flag chart pattern with incremental volume activity indicating further up move in the coming horizon.
Sun Pharmaceutical Industries Ltd
BUY, CMP: Rs 645.15, TARGET: Rs 675, SL: Rs 630
The stock is trading into a rising channel pattern making the higher top and higher bottom series on weekly and monthly charts, therefore all major technical trend indicators such as MACD and ADX are strong and intact. Thus upward movement from the current level is very likely to remain in the near term.
SELL, CMP: Rs 1,297.65, TARGET: Rs 1,230, SL: Rs 1,330
The stock is in a downtrend where the bears are quite strong at the moment as bulls are not able to gain strength, on the monthly scale as well the stock is trading below its rising trend line and short-term moving averages which indicates bearishness in the counter.
SELL, CMP: Rs 174.55, TARGET: Rs 165, SL: Rs 180
Bearish continuation formation is evident in the counter as it is continuously making lower high and lower lows, hence the overall structure of the stock suggest that it is heading to its previous demand zone on the downside
(Shrikant Chouhan is Executive Vice President (Equity Technical Research), Kotak Securities. Views expressed are the author’s own.)