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Nifty has maintained its higher top higher bottom formation on the monthly charts but it could not maintain the same structure on the weekly as well as on the daily charts which shows that while the long-term bullish trend is still intact, the medium-term trend has weakened.
On the daily charts, Nifty could not sustain above its 20-day SMA and it has formed lower top lower bottom price formation which suggests short-term trend has turned bearish.
The index remains above the long-term moving averages of 50-day, 100-day and 200-day SMA which is a relaxing factor.
The RSI plotted on the medium and long-term timeframe can be seen moving downwards.
The key support levels to watch out for in the short term are 14,467 (swing low) and 14,000 (key support), followed by 13,596 (swing low).
On the upside, the key resistance level is 15,051 (weekly high). If the index sustains above this level, we might see it heading higher towards 15,336 (3-week high) and eventually 15,431 (all-time high).
The long-term bullish trend remains intact but in the medium-term, we might see the index in a range between 14,460 to 15,431 levels.
Here are three buy calls for the next 4-5 weeks:
KEI Industries | LTP: Rs 508 | Target price: 672 | Stop loss: Rs 480 | Upside: 32%
This stock has been forming a higher top higher bottom pattern on the monthly charts since June 2020 which shows that the long-term bullish trend of the stock is intact.
This week, the stock has given a breakout of consolidation phase forming since December 2020. Besides, it has tested a fresh 52-week high and maintained its higher top higher bottom formation which indicates the next leg of bull run is ready to start.
We witnessed strong volume confirmation in every bullish movement which strengthens the ongoing up-trend.
The ADX plotted on the medium-term can be seen moving higher, indicating strong momentum of the current up-move.
The immediate resistance is placed at Rs 614 (November 2019 high), followed by Rs 672 (161.8 percent extension level of the rise from Rs 208-Rs 426 projected from Rs 319).
The key support levels are Rs 480 (swing low) and Rs 455.
One can buy the stock at the current levels for the target of Rs 614, followed by Rs 672.
ITC | LTP: Rs 219 | Target price: Rs 310 | Stop loss: Rs 192 | Upside: 42%
ITC has been taking strong support near Rs 200 mark. It is also 50 percent Fibonacci retracement level of its previous advance from Rs 163 to Rs 239 levels.
The stock has taken strong support at 100-day SMA with the formation of change in polarity structure on the daily charts.
The stock has formed higher top higher bottom formation on daily and weekly charts which shows a strong positive undertone of the stock for the medium-term.
The momentum indicator RSI plotted on multiple timeframes can be seen placed above the 50 level and moving higher, indicating that the stock is currently in bullish momentum.
The resistance is placed at Rs 240 (52-week high), followed by Rs 270 (August 2019 high) and eventually towards Rs 310 (May 2019 high).
The key level to watch out for on the downside is Rs 192 (December 2020 low), followed by Rs 163 (swing low).
One can buy the stock at the current levels for the target of Rs 239, followed by Rs 270 and Rs 310.
Adani Power | LTP: Rs 88.65 | Target price: Rs 145 | Stop loss: Rs 65 | Upside: 64%
Adani Power has been forming a higher top higher bottom pattern on all timeframes since May 2020 which shows a strong positive undertone of the stock for the medium-to-long-term.
On the daily charts, we have seen a consolidation breakout at Rs 65 level with volume confirmation and also the stock is sustaining above that level which indicates the strong bullish nature of the stock.
The RSI plotted on multiple timeframes can be seen placed above the 60 level, indicating that the stock is currently in a strong positive momentum.
The immediate resistance is placed at Rs 117 (161.8 percent Fibonacci extension level of Rs 15 to Rs 74 and projected from Rs 23 level), followed by Rs 145 (all-time high).
The key support levels are Rs 65 and Rs 55. One can buy the stock at the current levels with a target of Rs 117, followed by Rs 145.
(The author is AVP - Technical Research at GEPL Capital)
Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
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