“So it’s quite an interesting price behavior at the crucial 50-day EMA support, which is around 25,740. So markets are clearly lacking follow-on selling pressure after the last three days of sell-off that we’ve seen. Today we’re seeing some sort of strong recovery and this is being supported by put writing, which means the put-call ratio is also improving at this point,” he said.According to him, the key lies in the market’s ability to sustain this recovery until the close.
“The most important thing now is the maintenance. So if we manage to close above 25,850, it would be a positive signal and Nifty could very well move towards 26,100, 26,200 in the coming trading sessions,” he added, stressing that the recovery is actually coming from a crucial support region.
Sharma emphasized that historically, such setups often lead to meaningful upside moves.
“Looking at the current size of the market and the way the derivatives data is building up, this is an indication that overall, more often than not, such a recovery converts into a 300-point move for the Nifty.”
Maintaining a constructive stance on both the frontline indices, he added that Bank Nifty appeared relatively stronger.
“So the view on the Nifty remains positive and as far as Bank Nifty is concerned, it is the one leading the market. On the way down, it did not correct that much and now we believe that the timing is right for the banking index to cross the 60,000 mark again and achieve a decisive close above the same level. So the view of both Nifty and Bank Nifty remains positive, with Bank Nifty having the edge as of now, given the resilience we have seen in the private banking area.”
Stock ideas for Thursday trading
When asked about stock-specific ideas, Sharma shared two names from the auto and pharmaceutical sectors.
“Yes, so there are two. One of them is in the auto sector. So, Eicher Motors, the stock is consolidating close to its recent high. In fact, no correction has been witnessed in this stock despite the Nifty decline of around 500 points. So Eicher Motors looks good for a price target of 7500 to 7600. You can buy from a positional perspective with a stop loss at 7100 at the downside,” he said.
He also highlighted a developing bullish structure in Glenmark Pharma, albeit with conditions.
Apart from that interesting setup, there is also talk of Glenmark Pharma. This is a conditional buy. See if you can buy once it crosses the 1975 resistance area. It is currently trading at 1962. The risk-reward ratio is favorable in the same and the next targets at Glenmark Pharma are seen on the positive side in 2050 and 2070. So an immediate buy is Eicher Motors. Glenmark can be considered positive once it hits 1965 exceeds, with the stop loss placed at 1930.”
#Stock #Recommendations #Rahul #Sharma #Short #Term