JATIN GEDI
TECHNICAL RESEARCH ANALYST, SHAREKHAN
Where is the Nifty headed this week?
Nifty was consolidating in 21,150–22,150 range for the past one month. Last week, the index decisively closed above the upper end (22,150) indicating a range breakout. Daily and weekly momentum indicators have positive crossovers, which is a buy signal. The inside bar pattern breakout of the weekly charts suggests that the structure has turned in favour of the bulls and the index is likely to target levels of 22,500–22,530 which coincides with the upper end of the rising channel. In case of a dip, 22,130–22,090 is likely to act as a support and also provide an entry point for fresh long additions.
What should investors do?
The broader market has been under the hammer which is evident from the underperformance of the mid- and small-cap index. While the broader market is undergoing the much-needed consolidation, the action is likely to shift towards the frontline benchmark index and stocks. Index stocks are likely to attract buying interest during the week. Buy Reliance Industries at Rs 2,987 with a stop loss of Rs 2,927 for a target of Rs 3,124 –3,159. Buy UltraTech Cement at Rs 10,001; stop loss of Rs 9,802 for target of Rs 10,315–10,496. Buy Lupin at Rs 1,615; stop loss of Rs 1,580 for target of Rs 1,669–1,699.
ARPAN SHAH
SENIOR RESEARCH ANALYST, MONARCH NETWORTH CAP
Where is the Nifty headed?
Nifty closed at record highs and gave breakout above the swing high (22,126) on weekly chart. Historically an up-trending monthly series tends to close near the highest point so traders can expect upside momentum to continue in next week. However, one cannot rule out volatility in the expiry week. The 21-EMA is at 21,900 and any dip towards this will be a buying opportunity for the target of 22,500-22,700. Bank Nifty is facing resistance at 47,200 and breakout above will take it to 48,000-48,500. What should investors do?
HDFC Bank has witnessed strong delivery-based buying, investors should look to accumulate in the Rs 1,380-1,400 zone. Bajaj Finserv has made a strong base near Rs 1,550 and it closed with a bullish candlestick on Friday. Indus Tower and Inox India have given fresh breakouts on daily charts. Traders can look to trade all these stocks on the long side. Investors can look to add Allcargo, Sterling & Wilson, Landmark Cars and Indian Hotels on dips. NIFTY PSE index is facing resistance at 9,525 level, so traders should stay cautious in PSU stocks, and one should avoid chasing PSU names at current levels.
SACCHITANAND UTTEKAR
VP-TECHNICAL & DERIVATIVES, TRADEBULLS SECURITIES
Where is the Nifty headed next week?
With weekly RSI at 73, Nifty closed the week at a new all-time high, but it is far lower than its closing value of 77 as registered on 12 Jan 2024, when the index closed the week at 21,894. Price and RSI divergence on weekly scale indicates a lack of relative strength and the dominance of supply pressure during the upward move. Options data shows an upward shift in bounds towards 22,500 to 22,000, with 22,000 serving as the key pivotal support for keeping the bullish mode active. The index appears to be headed towards 22,390–22,500 as long as it continues to maintain its close above 21,920 (5-WEMA support).
What should investors do?
It’s ideal to retain a buy on declines strategy and avoid chasing momentum. Stocks related to the Nifty FMCG basket look better poised now for a comeback while banking and IT stocks continue to stack up incremental strength. Both ITC and HUL are looking stable now and could see a revival in their trends from here on which could help the index maintain its float during the upcoming series.
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