NIFT
CLOSE- 11470.75 (17.08.2018)
The market extended gain further & closed the 4th consecutive week in positive territory. It consolidated in a narrow range during the week. It made a high of 11,495.20 levels on Nifty & 38,076.23 levels on Sensex so far in this rally. It is slow & steady extending on the upside with high volatility. One can expect the market to extend further towards higher levels targets as mentioned below in short to medium term. Any kind of short-term consolidation or correction is stock specific buying opportunity till short-term reverses.
Midcap & small cap indices closed weekly in positive territory. It has shown stock specific strength during the week as expected. It looks like impulsive structure on the broader market from recent bottom on daily chart indicating an end of medium-term correction on the broader market near recent lows. we will see a sharp recovery in these stocks & indices in the rally ahead. These divergences now ended & broader market will also join the party with main indices Nifty & Sensex. Broader market will catch up with main indices with faster face in a rally ahead. One should still find out an opportunity to BUY quality beaten down stocks of mid-cap & small-cap index from medium to long-term perspectives.
The short-term outlook for the market remains positive till Nifty trades above 10,929 levels and expecting targets in the range of 11,500- 11,600 levels in short term. Medium term outlook for the market remains positive till Nifty trades above 9,951 levels and expecting targets in the range of 12,400-12,500 levels in the medium term.
BANK NIFTY closed weekly in positive territory. It also consolidated in a narrow range during the week. It made a high of 28,386 levels so far in this rally during the week. 26,926 levels is strong support for bank nifty for short term, till it holds one can expect higher levels targets till 29,650 levels in short term. 26,000 levels is crucial support for bank nifty from medium-term perspectives until it holds one can higher levels targets till 32,800-33,000 levels on Bank Nifty as per monthly chart attached here. It continues to outperform in the rally ahead.
11,000/11,200 & 11,500 levels is strong support & resistance levels respectively based on option open interest data for current month series expiry perspectives. This rally will have time wise consolidation rather than price wise correction in short term. Any kind of such short-term correction or consolidation is buying opportunity for medium to long-term Investment perspectives till medium term reverses.
Momentum indicators Daily KST & DAILY MACD both are in SELL, indicating volatility in short term. It may spend some more time in these range for the short term. One should be stock specific & follow the trend with trail stop loss levels till it reverses. Close below short-term reversal levels will lead to sharp correction till 10,500-10,400 levels on Nifty & 34900-34300 levels on Sensex in short term.
Stock Picks:
DHFL - BUY
CLOSE – Rs- 670
TARGET – Rs- 700-740
DHFL closed the weekly in positive territory. It has broken out of short-term consolidation range. Its daily momentum indicators are in BUY. It is trading above 20DMA. One can BUY with a stop loss of Rs-626 for the target of Rs 700-740 levels in short-term.
CADILA HEALTHCARE - BUY
CLOSE – Rs 356
TARGET – Rs 380-410
CADILA HEALTHCARE closed the weekly in positive territory. It looks like the end of medium-term correction. Risk Reward is favourable to BUY at current levels. Its weekly momentum indicators are in BUY. One can BUY with a stop loss of Rs-332 for the target of Rs-380-410 levels in short-term.
TATA CHEMICALS - BUY
CLOSE – Rs 710
TARGET – Rs 745-785
TATA CHEMICALS closed the weekly in positive territory. It looks like the end of medium-term correction. Risk Reward is favourable to BUY at current levels. Its daily momentum indicators are in BUY. One can BUY with a stop loss of Rs-656 for the target of Rs-745-785 levels in short-term.
BHARAT FORGE - BUY
CLOSE – Rs 632.40
TARGET – Rs 668-700
BHARAT FORGE closed the weekly in positive territory. It looks like the end of short-term correction. Risk Reward is favourable to BUY at current levels. Its weekly momentum indicators are in BUY. It closed above 20DMA. One can BUY with a stop loss of Rs-585 for the target of Rs-668-700 levels in short-term.
Devang Shah is the author of www.trendtechno.com (Trade with Trend) and an independent market analyst.
Disclaimer: The analyst may / may not have a position in the scrips mentioned above