PRICE MEHTA
EXECUTIVE VICE PRESIDENT – RESEARCH, YES EFFECTS
Where will Nifty go this week?
The base of the index continues to shift higher, with immediate support around the 24,900 zone. This month, both the Financial Services and Bank Nifty indices have played a key role in driving the recent upward move. Relative strengths indicate potential outperformance. For the Nifty, a move above 25,440 would trigger a double-top buy signal, opening the possibility of an upward move towards the next three-digit Gann number of 25,700 in the coming weeks. What should investors do?
After almost two years of consolidation, the ratio chart for consumer discretionary versus FMCG has broken out, signaling renewed strength and potential outperformance of discretionary names versus defensives. Our bespoke tire index has also made a breakthrough, indicating a potential upside of 10-12% for Ceat and Apollo tyres. On the financial front, the Bank Nifty has staged a bullish turtle breakout on the Point & Figure chart, followed by a bullish anchor column. The projection suggests a move towards 58,000. Within banking, Axis Bank, Kotak Bank and Bank of Baroda are expected to outperform.
RUCHIT JAIN
HEAD OF TECHNICAL RESEARCH, MOTILAL OSWAL FINANCIAL SERVICESWhere will Nifty go this week?
Nifty has consolidated in a wide range of 1,000 points in the last few months, which seems to be a time-oriented corrective phase. However, the Bank Nifty seems to have taken over the leadership this time and has started showing relative outperformance. So, the short-term trend for Nifty appears sideways, with immediate hurdles in the 25,400-25,500 range, and support at 24,900-24,800. A breakout above this range is required for a resumption of the positive trend. Index traders can look for buying opportunities in Bank Nifty on a decline as it has shown a breakout from the ‘reverse head and shoulders’ pattern, which implies a positive trend. Support for the banking index is estimated at 56,000–55,800, and any declines towards this range could be seen as buying opportunities.
What should investors do?
As far as sectoral indices are concerned, the Nifty PSU Bank index has outperformed and could continue to do so. Traders can look at stocks like SBI, which is leading the momentum, and Punjab National Bank, which has shown a breakout from the ‘Cup and Handle’ pattern on the weekly chart. L&T is on the cusp of a breakout from significant consolidation, and CDSL looks bullish from a positional perspective.
Rupeak de
SENIOR TECHNICAL ANALYST, LKP SECURITIES
Where will Nifty go this week?
Nifty posted two consecutive green candles on the daily time frame, indicating renewed buying interest from strong hands. The recent outbreak of consolidation has added momentum as bulls begin to regain control. A hidden positive divergence in the daily RSI (14) has also provided support for the ongoing rally. However, the index is not out of the woods yet as it is still trading below the previous swing low, which could act as a crucial resistance level. Notably, Nifty has closed in the green in six of the last seven sessions, clearly reflecting the bullish dominance in the market. Moreover, a series of higher lows further underlines the improving buying sentiment. The coming days could be interesting as the bulls could try to push the index towards the 25,500-25,550 zone. It is worth seeing if the bears can stop the advance around this level. If Nifty manages to move above 25,550, the next potential target could be around 25,850.
Trading Strategies for the Week:
As long as the index remains above 25,000, the market can continue to offer buying opportunities. Sector developments such as banking, auto, metals and consumer-themed stocks could deliver strong gains. Stocks such as Mahindra & Mahindra, Federal Bank, State Bank of India, Swiggy and InterGlobe Aviation (IndiGo) may see significant buying interest.
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