Nifty is likely to consolidate within the broader trading band of 10,750 to 10,880, says Jaydeb Dey, Technical Analyst at Stewart & Mackertich Wealth Management.
Jaydeb Dey
The Nifty ended Monday flat at 10,806.60 levels. It opened on a flat note and remained subdued for the entire session. Consolidation above the dual support zone of 10,780 to 10,750 led to a Doji Star candle on the daily chart. This implies indecision among traders. Hence, investors and traders are advised to remain cautious ahead of Karnataka election results. On the upside, major resistance is placed around 10,880 levels.
On the hourly chart, the Nifty continues to make higher highs despite negative divergence. At present, it is trading well above all the critical moving averages. Hence, a buy on dips is advised. Downside critical supports are placed around 10,780 and 10,750 levels.
Nifty patterns on multiple timeframes show that it ended the day on a subdued note ahead of Karnataka election results. The broader trading range for the coming sessions is expected to be 10,750 to 10,880.
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The Bank Nifty ended Monday 0.23 percent higher at 26,475.15. It ended the session on a positive note and is likely to continue this momentum as long as it trades above 26,100. The upside critical resistance is placed around 26,460 levels.
Based on thorough technical study, we recommend ACC for the short-term:
ACC | Rating: Buy | Target: Rs 1500, stop loss: Rs 1410, Return: 4 percent
The stock has been in a mid-term downtrend since last several weeks. Yesterday it touched the long-term upward trend line support placed around 1440 levels and ended in negative. Weekly as well as the daily charts look extremely oversold. Hence, a counter pullback is likely.
Based on the above mentioned observations, we recommend ACC as a buy on dips for the short-term down side target of 1500.
Disclaimer: The author is Technical Analyst at Stewart & Mackertich Wealth Management Ltd. The views and ideas expressed above may have been suggested to the clients of Stewart & Mackertich Wealth Management Ltd. It is advised that investors/traders should consult with their Certified Experts before taking any investment decision.