NIFTY
CLOSE- 10472.50 (12.10.2018)
Market closed 1st weekly positive close after the decline of consecutive preceding five weeks. We have seen sharp selloff across the board in preceding last five weeks. It made a low of 33,723.50 levels in Sensex & 10,138 levels on Nifty in this correction. It sharply reversed from these levels & closed weekly in positive territory. It looks like the end of short-term correction after 5 wave decline from peak and one can expect pullback rally to continue further towards higher levels targets till short-term reverses.
It looks like the high possibility of end of wave-IV (ABC) medium Correction as per chart attached. One should also watch out other evidence for further confirmation of the same. But Risk reward is favourable to BUY stock specific at current levels from medium to long-term perspectives, as the market is near medium-term support/ reversal levels as mentioned below.
BANK NIFTY also closed 1st weekly positive close after the decline of consecutive five weeks. It also looks like the end of wave-IV (ABC) medium-term correction as per chart attached. It looks like the end of short-term correction after 5 wave decline from peak and one can expect pullback rally to continue further towards higher levels targets till short-term reverses. 24,270 is short-term support/reversal on Bank Nifty till it holds one can expect higher levels targets till 26,100-26,800 levels in short term. 23,000 levels is strong support on Bank Nifty from medium-term perspectives till it holds one can expect higher levels targets till 32,000-33,000 levels in the medium term.
10,000 & 10,500/10,800 levels is strong support & resistance levels respectively based on option open interest data for expiry perspectives for current month series. Any kind of such short-term correction or consolidation is buying opportunity for medium to long-term Investment perspectives till medium term reverses. Participation from beaten down broader market midcap & small cap indices is important to watch out from medium-term perspectives from here on.
Momentum indicators Daily KST & DAILY MACD both are in sell indicating volatility to continue in 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 the further continuation of sell-off till 9,950 levels on Nifty & 32,483 levels on Sensex in short-term
Short-term outlook for the market remains negative till Nifty trades above 10,138 levels and expecting targets in the range of 1,080-11,100 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 12,500-12,800 levels in the medium term.
BANK NIFTY also closed 5th consecutive week in negative territory. It has made a low of 24,364.90 levels so far in this correction. 23,600 levels is crucial support & my short-term targets levels as well for Bank Nifty in short term. While medium-term outlook for Bank Nifty still remains positive till it trades above 20,900 levels & expecting targets in the range of 32,000-33,000 levels in the medium term.
10,000 & 10,500 levels is strong support & resistance levels respectively based on option open interest data for expiry perspectives for expiry perspectives next week. 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 supporting the short-term trend. One should be stock specific & follow the trend with trail stop loss levels till it reverses. Close above short-term reversal levels will finally confirm the end of these correction & rally towards higher levels targets as mentioned above in medium term.
Stock Picks:
PIDILITE – BUY
CLOSE – Rs 994
TARGET – Rs 1,060
Pidilite closed the weekly in a positive territory. It looks like the end of short-term correction. Risk reward is favourable to buy at current levels. It has wave-V Up pending on the upside. One can buy with a stop loss of Rs 933 for the target of 1,060 levels in short term.
CUMMINS – BUY
CLOSE – Rs 678
TARGET – Rs 730-760
Cummins India closed the weekly in a positive territory. It looks like the end of short-term correction. Risk reward is favourable to buy at current levels. It has wave-V Up pending on the upside. One can buy with a stop loss of Rs 640 for the target of 730-760 levels in short term.
POWERGRID – BUY
CLOSE – Rs 188.25
TARGET – Rs 195-200
POWERGRID closed the weekly in a positive territory. It looks like the end of short-term correction. Risk reward is favourable to buy at current levels. It has wave-V Up pending on the upside. One can buy with a stop loss of Rs 180 for the target of 195-200 levels in short term.
Devang Shah: 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 scripts mentioned above.