Edited excerpts from a chat:
Despite Wednesday’s loss, the market appears to be on a steady upward trend in October. Is it too early to dream of 26,000?
The Nifty has posted gains in six out of the last seven sessions, indicating bullish dominance in the recent period. Rising bottoms on the daily chart, coupled with a recent consolidation breakout, have set the stage for a potential short-term rally. The recent upward move has helped Nifty recover over 75% of its previous losses, indicating a possible trend reversal. From here, the 26,000 limit is just a number; an increase towards 25,850 and beyond seems well within reach. On the other hand, 25,000 is likely to act as a crucial short-term support level.
Both Nifty Bank and Nifty IT outperformed Nifty this week. Where do you see the opportunity going next?
During the week, both Bank Nifty and Nifty IT outperformed the benchmark Nifty index. The most important question, however, is whether they can continue to outperform in the short term. Let’s look at them one by one.
Bank Nifty has shown a significant trend reversal supported by a break in consolidation on the weekly chart. The momentum and trend remain in favor of the bulls in the short term, and on the higher side the index could head towards a new all-time high.
Nifty IT, on the other hand, made quite a comeback and rose around 5% during the week. However, gains in the index may be limited in the short term. On the other hand, a move below 35,150 could reignite corrective sentiment in the space.
Given the sharp rally in Tata Communications shares on Friday in hopes of becoming a beneficiary of TCS’s planned $6-7 billion investment in AI data centers, would you be a buyer of the stock in the coming week or is it time to book profits?
Given the sharp rally in Tata Communications shares on Friday, hoping to capitalize on TCS’s planned investment of $6-7 billion in AI data centers, the breakout appears structural, indicating the potential for a medium-term rally. A move towards Rs 2,300 in the next nine to 12 months seems feasible. On the other hand, Rs 1,700 acts as a key support; a sustained move below this level could weaken the bullish stance. A buy-on-dips strategy looks favorable at current levels.
BSE stocks were among the biggest gainers this week. Do you think the momentum will continue?
The stock has shown significant breakout on a weekly basis, fueling a strong rally. The alignment of price action and momentum indicators indicates continued strength in the short to medium term. The momentum is expected to continue in the coming days, which will favor long positions.
Top picks
Buy NYKAA: Rs 265, TGT Rs 280, SL Rs 255
The stock has risen with strong momentum, supported by robust demand. Any dips are quickly bought in, while the corrections remain superficial. The recent chart shows a strong breakout, putting the stock back on the buy radar. On the higher side, it could move towards Rs 280 while the support is around Rs 255.
Buy INDIGO: Rs 5,800, TGT Rs 5,950, SL Rs 5,600
The stock moved higher after a phase of consolidation on the daily chart. The recent upward move pushed the price above the 21 EMA, indicating a positive short-term trend. Moreover, the RSI has entered a bullish crossover, confirming the improving momentum. The trend seems positive with the price likely to rise towards Rs 5,950 and support towards Rs 5,600.
Buy FEDBANK: Buy on dips around Rs 205, TGT Rs 215, SL Rs 200
The stock has seen a significant breakout in the daily market, indicating rising optimism. The price is trading above the major moving averages, confirming a positive trend. The RSI is in a bullish crossover, further supporting momentum. The trend seems positive, with the price likely to move towards Rs 215, and immediate support at Rs 200.
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