Vinay Rajani-HDFC securities
In yesterday’s trade, the Nifty saw a rise for the 6th consecutive day. Yesterday Nifty closed at an all-time high of 18,476. Now the next resistance for Nifty is seen around 19,230. For the last three trading sessions, Nifty is closing strongly with an upward gap. Nifty has entered the Blue Sky Zone. Here the best strategy would be to stay in the long position with a trailing stoploss.
In such situations traders would be advised to follow the trend. Right now we don’t need to think that the market has run too far and has reached its peak. The momentum seems to be completely in favor of the bulls. Sensex and Nifty may rise further from current levels. Now the previous resistance level of 17,950 has become a support level for Nifty.
6 stocks in the finance sector that became multibaggers in 1 year
The technical setup for Bank Nifty looks very strong. Last week we saw a fresh breakout above 38,400. The upside target for Bank Nifty is now visible at 40,000-40,800. Its previous resistance of 38,400 will now act as support for it. Its 14-day RSI (relative strength index) is at 75.5, which is the highest level since February 2021. Higher RSI should be considered as a signal of strength in the underlying as long as we do not see any negative divergence.
A trend breakout is being seen on the chart in NSE500’s 52-week high stocks. Stocks that are trading above their 200 DMA can also see momentum again. This is a sign that the market breadth seems to be consolidating. This is a good sign for a healthy bull market.
A fresh bullish break out has been seen in Nifty Metal Index on the weekly chart. It is expected that going forward Metal, Bank, NBFC and Auto will see better performance from the benchmark indices. Good stocks in these sectors should be bought from a short term perspective. Apart from this, Realty, PSE and Energy stocks which are bullish will continue to perform well.
The technical setup of the global market is indicating that some important base metal commodities are once again in a bullish phase. This is also a good sign for the Indian equity markets. Taking a look at the technical indicators, we feel that the Nifty trend will continue to be bullish. Traders are advised to stay in long positions with trailing stoplosses. Currently put stoploss for Nifty at 18,200. Further up to 19,230 can be seen in Nifty.
Trade setup for today: Take a look at these figures before the market opens, it will be easy to catch profitable deals
These stocks will have strong earnings in 2-3 weeks
Indian Bank: Buy | LTP: Rs 171.45 | Buy this stock with a stop loss of Rs 160 and target Rs 199, and give a return of 16.1 per cent in 2-3 weeks.
JK Tyre and Industries: Buy | LTP: Rs 158.95 | Buy this stock with a stop loss of Rs 142 and target Rs 192 with a return of 20.8% in 2-3 weeks.
Can Fin Homes: Buy | LTP: Rs 701.55 | Buy this stock with a stop loss of Rs 670 and target Rs 780 with a return of 11.2 per cent in 2-3 weeks.
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