In this week, 10,820 and 10,715 are likely to provide
cushion to the prices and 10,960-10,980 range will continue to act as an important resistance level for bulls, which if taken out on higher side decisively would result in breakout of a range
The Nifty reclaimed the lost ground previous week and for the third time in the last month, 50-Day Moving Average emerged as an important support level for the bulls. Initial weakness in the week was bought into and the index closed with the gain of around 1 percent at 10,906.95.
The consolidation phase of Nifty has eventually resulted in the formation of Symmetrical Triangle pattern and last week we broke out of it. Generally the pattern is more effective if breakout takes place within the two-thirds distance from the end of the triangle but in this case, it happened at the end and such scenario indicates that the strength of breakout is till 10,960 only.
Apart from this, the whole technical structure is gradually moving towards a positive zone as after several weeks, Nifty is trading above its 50, 100 and 200-Day Moving Averages.
In this week, 10,820 and 10,715 are likely to provide cushion to the prices and 10,960-10,980 range will continue to act as an important resistance level for bulls, which if taken out on higher side decisively would result in breakout of a range. Then, we can expect Nifty to touch 11,145 and 11,360 in days to come.
Nifty options: Option band signifies a trading range of 10,700-11,000 in coming days as 10,700 Put option is holding more than 37 lakh cumulative open interest. Unwinding in 11,000 and 11,100 Call option suggests resistance is getting weaker and we can expect trending move soon.
Wipro: Buy | CMP: Rs 346.15 | Target: Rs 398 | Stop loss: Rs 318 | Return: 15 percent| Medium term
The stock has been trading in a range since 2014 and has recently given a breakout. Monthly RSI has started trading in a bullish zone for the first time after 2015.
On the daily chart, a long bullish candle has formed after a phase of consolidation and prices are tagging above upper Bollinger Band. Momentum indicators are suggesting that upward movement is likely to continue. Thus, the stock can be bought at CMP and on any dip till Rs 325 for medium-term gain.
Manappuram Finance: Sell | CMP: Rs 97.15 | Target: Rs 90 | Stop loss: Rs 101.50 | Return: 7 percent| Short term
The stock has formed bearish candlestick pattern at resistance line on the weekly chart and RSI has formed bearish reversal pattern. The recent rise in price is facing resistance at 61.8 percent retracement level of the latest swing move. On the monthly chart, prices are facing resistance at 20-month moving average.
On the daily chart, the stock has formed bearish engulfing candlestick pattern along with negative divergence. Thus, selling positions can be created for a short-term gain.
Bank of India: Sell | CMP: Rs 103.15 | Target: Rs 98 | Stop loss: Rs 107 | Return: 5 percent | Short term
The stock has formed bearish engulfing candlestick pattern followed by bearish Doji. RSI has reversed from the resistance zone and suggests recent upmove has taken a pause and short-term dip is likely in days to come.
On the daily chart, the stock has started trading below the short-term moving averages and some corrective action is expected. Hence, short positions can be initiated for short-term gain.
ICICI Prudential Life: Buy | CMP: Rs 351.15 | Target: Rs 386 | Stop loss: Rs 325 | Return: 10 percent| Medium Term
The stock has broken out of a declining trendline resistance and a bullish trend can be seen. Bullish crossover of important short-term and long-term exponential moving averages on the daily chart suggests trend reversal buying is expected in the days to come.
On the weekly chart, after forming several bullish candlestick pattern, the stock is finally trading above 20-week moving average and momentum indicators suggest a new leg of upmove is expected.
Larsen & Toubro: Sell | CMP: Rs 1,322.8 | Target: Rs 1,240 | Stop loss: Rs 1,370 | Return: 6.5 percent | Short term
Last month stock has formed bearish Doji candlestick pattern with negative divergence and the low of the pattern has broken on the lower side this month that is creating a fresh sell signal.
On weekly charts, the stock has formed “bearish engulfing” as well as “three black crows” candlestick pattern indicating bears have taken the charge.
On the daily chart, the stock has closed below 200-Day Moving Average and momentum indicators are trading in a bearish zone. It suggests bears are likely to have upper hand in coming days and traders can sell for a short-term gain.
Disclaimer:-The views and investment tips expressed by investment experts are their own. Ripples Advisory advises users to check with certified experts before taking any investment decisions.
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