SRIRAM VELAYUDHAN
VP-ALTERNATIVE RESEARCH,
Where is Nifty headed this week?
Indian equities have been underperforming, partly owing to the regional reallocation of money in the new year. This year, foreign portfolio investors have been net sellers to the extent of Rs 14,123 crore in the secondary market. Nifty has been trading in a range of 17,800-18,250 for the last three weeks now. For any decisive move on either side to materialise, the index has to break these levels. On the lower end, a 100- day moving average of 17,900-17,800 has been strong support. However, this week, we expect Nifty to move towards 18,250, the higher end of the trading range.
What should investors do?
As a sign of encouragement, Nifty closed above 100 DMA and nearly 10 DMA last week. Hence traders with some risk appetite can buy Nifty futures for a target of 18,250 and place a stop loss at 17,900. We believe financials, metals, capital goods, and technology will likely outperform on the sectoral front, while FMCG and pharma may underperform. Investors can buy select names like the HDFC twins,
, Larsen & Toubro, Tata Steel, and Hindalco from a medium-term investment horizon. As we expect public sector banks to continue outperformance, investors can explore buying PSU bank ETFs.
AJIT MISHRA
VP-RESEARCH,
BROKING
Where is Nifty headed this week?
Despite the negative tone, the bulls are trying hard to defend the 17,800 zones but facing tremendous pressure on every rebound, resulting in the formation of lower highs. A decisive close above 18,100 could ease pressure and help the Nifty inch towards the 18,250-18,350 zone. On the flip side, a breakdown of 17,800 would confirm the resumption of the corrective phase and push the index to 17,500 levels.
What should investors do?
We recommend focusing on the sector and stock-specific opportunities until we see a decisive break from Nifty’s 17,800-18,100 zone. Among the sectoral pack, metal looks strongest, and continued recovery in the IT pack will also be on participants’ radars while others offer mixed signals. The recent resilience in the broader indices is certainly encouraging, but investors should not go overboard as we usually see sharp cuts in mid-caps and small-caps during the corrective move. Among the list of stocks from the derivatives space, traders may consider Dalmia Bharat, Federal Bank, Godrej Consumer, , , and Tata Steel for long trades. On the other hand, Tata Consumer, , UPL, and Zee are some of the stocks that are looking weak.
SAMEET CHAVAN
CHIEF ANALYST-TECHNICAL & DERIVATIVES, ANGEL ONE
Where is Nifty headed this week?
On the weekly chart we can see a Doji pattern which indicates uncertainty, and it seems market participants are awaiting a trigger for the next directional move. In our sense, the December month swing low of around 17,750 is acting as a fortress for the bulls, and as long it holds, one should continue with the buy-on-dip approach. On the flip side, resistance levels are shifting lower as the trading range is getting coiled. On the hourly chart, we see a trend line resistance around the 18,000-18,050 levels. A sustained trade beyond it can trigger positive momentum in the coming week. Stiff hurdle remains at 18,300, which can resume the primary uptrend once broken.
What should investors do?
Even though the benchmark was trapped in a range, some pockets showed strength, and going ahead as well, we advise traders to continue with the stock-centric approach as the individual themes may play out well ahead of Budget.
has seen good traction in the past few sessions and has surged over 5% in the week, indicating inherent strength. After resting above key moving averages, prices of finally took off and confirmed a breakout from the ‘Bullish Flag’ pattern.
