Nifty has maintained its higher top, higher bottom formation on the weekly chart and has managed to sustain above the 15,200 mark after two months which shows a strong bullish undertone of the market for the medium to long term.
A couple of days back, Nifty formed change in polarity structure near 14,900–14,800 range on the daily timeframe and bounced back sharply after bottoming out near these levels which indicates this range willact as a crucial support zone in the future.
The index remains above the long-term moving averages of 50-day, 100-day and 200-day simple moving averages. The RSI plotted on the medium and long-term timeframe can be seen rising indicating the medium and long-term trend of the index remains bullish.
The key support levels to watch out for in the short term are 15,135 (previous swing high) and 14,884 (5-day low).
On the upside, the key resistance level is 15,431 (all-time high). If the index sustains above this level, we might see it head higher towards 15,910 (78.6 percent extension level of the rise from 13,596-15,431 projected from 14,467) and eventually 16,303 (100 percent extension level of the rise from 13,596-15,431 projected from 14,467).
Here are three buy calls for the next 3-4 weeks:
BSE | LTP: Rs 913 | Target price: Rs 1,200 | Stop loss: Rs 773 | Upside: 31%
This stock has been forming higher top and higher bottom patterns on all the timeframe charts since April 2021 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 773 with volume confirmation a couple of days back.
We also witnessed a strong momentum after the breakout which indicates the strong bullish nature of the stock.
On the indicator front, the RSI plotted on multiple timeframes can be seen placed above the 60 level and moving higher, indicating that the stock is currently in a strong positive momentum.
The immediate resistance is placed at Rs 1,039 (September 2017 high), followed by Rs 1,200 (all-time high).
The key support levels are Rs 773 and Rs 680. One can buy the stock at the current levels with a target of Rs 1,039, followed by Rs 1,200.
Infosys | LTP: Rs 1,408.90 | Target price: Rs 1,795 | Stop loss: Rs 1,311 | Upside: 27%
On the monthly charts, this stock has maintained its strong bullish mode with the formation of a higher top higher bottom formation.
On the weekly charts, it has taken support at a 20-week simple moving average couple of weeks back and once again it has started moving higher.
The momentum indicator RSI plotted on multiple timeframes can be seen placed above the 60 level and moving higher, indicating that the stock is currently in a strong bullish momentum.
The resistance is placed at Rs 1,540 (23.6 percent extension level of the rise from Rs 509-1,477 projected from Rs 1,311), followed by Rs 1,681 (38.2 percent extension level of the rise from Rs 509-1,477 projected from Rs 1,311) and eventually towards Rs 1,795 (50 percent extension level of the rise from Rs 509-1,477 projected from Rs 1,311).
The key levels to watch for on the down are Rs 1,311 (5-week low), followed by Rs 1,231 (swing low).
One can buy the stock at the current levels for the target of Rs 1,540, followed by Rs 1,681 and Rs 1,795.
Asian Paints | LTP: Rs 2,965 | Target price: Rs 3,350 | Stop loss: Rs 2,845 | Upside: 13%
This stock has been forming a bullish pattern of higher top higher bottom on all the timeframes since March 2021.
It has also been sustaining at an all-time high level which shows a strong positive undertone of the stock.
On the daily chart, the stock has given a saucer pattern breakout with volume confirmation and it has a potential upside to Rs 3,350 level.
On the monthly charts, we witnessed a bullish ABC pattern breakout which strengthens the positive momentum of the stock for the medium to long term.
On the indicator front, 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 3,259 (61.8 percent extension level of the rise from Rs 1,295-2,873 projected from Rs 2,260), followed by Rs 3,350 (potential target of saucer pattern).
The key support levels are Rs 2,845 (swing low) and Rs 2,700. One can buy the stock at the current levels and add on dips till Rs 2,900 for the target of Rs 3,259, followed by Rs 3,350.
(The author is AVP - Technical Research at GEPL Capital)
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