Nifty posted weekly losses for the third time in a row. Should we still hope for a Santa rally?
Nifty has been sliding along a downtrend line for the past three weeks. However, it is now more poised than previous weeks to make an upward move. Otherwise, the week’s down attempts were held just above the previous week’s low, pointing toward a bottom formation. This encourages us to aim for 26300 initially. However, should Nifty fail to float above 25980, expect sideways moves.
The Christmas rally has in the past been more pronounced among small cap stocks. Do you think there will be some bottom fishing in the wider market until the end of 2025?
Although Nifty closed on a high, the number of stocks closing above their respective 10-day SMA fell to 58%, compared to 64% in the previous week. In contrast, the Nifty Smallcap 250 index had 57% of its constituents above this benchmark, up from the previous week’s 39%. This suggests that small caps are starting to catch up, encouraging a stock-selective approach to small cap stocks in the short term.
The Indian VIX hit a new low this week as the market seems to have no direction. How would you read this data point to predict Nifty’s movement in the coming weeks?
A low VIX generally indicates that investors are comfortable with near-term volatility expectations. Now that we have arrived at the current juncture where Nifty has been slipping for the past three weeks, the risk taking intent seems to be there. Moreover, the most recent occurrence of similar values was in late September, soon after Nifty started rising 6% after a brief dip. This is an encouraging sign for the coming weeks, but initially be weary of the uptick in volatility.
Ola shares ended the week 6% lower despite Friday’s buying. What should traders do now?
A positive divergence amid overbought signals from other oscillators paved the way for Friday’s recovery upward move. But beyond this signal, there isn’t much else to indicate a complete turnaround is in play. We believe that more downward or sideways moves must occur before a sustainable uptrend emerges.
Give us your best ideas for the week ahead.POLYMEDE (CMP: 1810)View: buy
Target: 1890
SL: 1744
The stock has been in a profit-booking phase since November 2024 and now appears to be trying to build a base around the 50% Fibonacci retracement level (between the June 2022 low and the November 2024 high) and the Supertrend level near 1,740. Volumes have dried up in recent days, with a Doji candle forming on Friday, supported by volume, signaling a possible attempt to bounce back. We expect the stock to move towards 1,890 in the near term. All long positions should be protected with a stop-loss below 1,744.
TI (CMP: 450)
View: buy
Goal: 480
SL: 434
Multiple Doji candles on the weekly scale near the horizontal support zone of 438, along with a bullish Marubozu candle on the daily scale, indicate positivity. The short-term RSI has crossed above the moving average and the price has crossed above the moving average, further supporting the short-term upside potential. We expect the stock to move towards 480 in the coming weeks. All long positions should be protected with a stop-loss below 434.
#Ola #shares #tactical #recovery #trend #reversal #lacks #conviction #Anand #James