“As of now a patch of consolidation is more of a sector churn. But bias remains extremely bullish on the indices,” says independent market analyst Kunal Bothra
The week was taken over by IT thanks to all those big results like Infosys, Wipro, TCS, Mindtree, HCL Tech. Going forward in the new week, what are you looking forward to?
The broad based nature of the market which emerged quite well. There was strong vibrancy in midcaps and smallcaps. Even when indices went into a patch of intraday consolidations, there were still a lot of stocks which were hitting either upper circuits or closing at day’s highs for themselves. So all of these indicate that the market sentiment is positive. But then within the rally and within an uptrend you keep getting into those phases where there is a lot of churn in terms of sectors. I think we are now starting to get into that kind of a zone. Once that churn gets over and the market gets back into that traditional phase where the high beta stocks and high beta sectors start to get into a rally mode, and by that I specifically mean that if the Bank Nifty starts to recover which I am assuming which could probably happen in the first half of the next week then we could see the index coming back into full throttle mode yet again. So as of now a patch of consolidation is more of a sector churn. But bias remains extremely bullish on the indices.
What is the one big theme for you for the new week?
There are two themes that I would probably play out. One of them is the comeback of metal names, the breakout which we have seen for metal stocks on Thursday or Wednesday, I think is just about exceptional. They have managed to — in technical terms we call it – hit a double bottom breakout and it is a huge double bottom pattern almost like a 10 per cent double bottom getting formed for the metal index. This is why the breakout which had happened in the previous week was something very-very notable and important. It could probably even mark the comeback of the sector overall. So it is not just a short-term bump up which I am expecting but possibly a turnaround for many of the metal stocks going forward. The dollar index as well is probably helping the metal stocks to trade with a positive bias for themselves. And the second most important theme would be the comeback of Bank Nifty, rather the sustenance of the bank index. The kind of moves which we have seen almost like a 4,000-point-plus gain on the banking index in the last two to three weeks, I believe that there is a strong scope for Bank Nifty going forward and it can reclaim the 39,000 mark for itself maybe next week or beyond that.
It is going to be a busy week? What strategies would you play? What stocks would you look forward to?
The PSU theme is what I am eyeing. So first one is a buy on , the stock heading towards a breakout. Friday, we saw good price action, expecting the stock to pick up pace going forward broken past above Rs 900 levels so would suggest a buy with Rs 1,000 as a target and stop loss could be kept at Rs 860. is the other stock which is showing good price action, forming a bullish pendant on the very short term charts and has broken past the downward sloping trend line for itself. So this could indicate a start of a new trend for BHEL as well, buy with a target of Rs 70, stop loss Rs 60.
The week was taken over by IT thanks to all those big results like Infosys, Wipro, TCS, Mindtree, HCL Tech. Going forward in the new week, what are you looking forward to?
The broad based nature of the market which emerged quite well. There was strong vibrancy in midcaps and smallcaps. Even when indices went into a patch of intraday consolidations, there were still a lot of stocks which were hitting either upper circuits or closing at day’s highs for themselves. So all of these indicate that the market sentiment is positive. But then within the rally and within an uptrend you keep getting into those phases where there is a lot of churn in terms of sectors. I think we are now starting to get into that kind of a zone. Once that churn gets over and the market gets back into that traditional phase where the high beta stocks and high beta sectors start to get into a rally mode, and by that I specifically mean that if the Bank Nifty starts to recover which I am assuming which could probably happen in the first half of the next week then we could see the index coming back into full throttle mode yet again. So as of now a patch of consolidation is more of a sector churn. But bias remains extremely bullish on the indices.
What is the one big theme for you for the new week?
There are two themes that I would probably play out. One of them is the comeback of metal names, the breakout which we have seen for metal stocks on Thursday or Wednesday, I think is just about exceptional. They have managed to — in technical terms we call it – hit a double bottom breakout and it is a huge double bottom pattern almost like a 10 per cent double bottom getting formed for the metal index. This is why the breakout which had happened in the previous week was something very-very notable and important. It could probably even mark the comeback of the sector overall. So it is not just a short-term bump up which I am expecting but possibly a turnaround for many of the metal stocks going forward. The dollar index as well is probably helping the metal stocks to trade with a positive bias for themselves. And the second most important theme would be the comeback of Bank Nifty, rather the sustenance of the bank index. The kind of moves which we have seen almost like a 4,000-point-plus gain on the banking index in the last two to three weeks, I believe that there is a strong scope for Bank Nifty going forward and it can reclaim the 39,000 mark for itself maybe next week or beyond that.
It is going to be a busy week? What strategies would you play? What stocks would you look forward to?
The PSU theme is what I am eyeing. So first one is a buy on , the stock heading towards a breakout. Friday, we saw good price action, expecting the stock to pick up pace going forward broken past above Rs 900 levels so would suggest a buy with Rs 1,000 as a target and stop loss could be kept at Rs 860. is the other stock which is showing good price action, forming a bullish pendant on the very short term charts and has broken past the downward sloping trend line for itself. So this could indicate a start of a new trend for BHEL as well, buy with a target of Rs 70, stop loss Rs 60.
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