Adopt 'buy-on-dips' strategy for Nifty FMCG index, suggests Ravi Nathani

Nifty FMCG
Last close: 45,722

The Nifty FMCG index exhibits a near-term bullish trend, which signifies favorable market conditions for investors. Under these circumstances, the most optimal trading strategy would be to 'buy on dips', thereby capitalising on market downturns and maximizing profits.

It is anticipated that the target or resistance levels may reach 46,025 - 46,400, which indicates substantial potential gains for savvy investors.

The relative strength index (RSI) currently stands at 57, which is indicative of a bullish market outlook, as it suggests that the buying momentum is gaining strength.

It is a positive signal for those seeking to adopt bullish positions in the market. Traders seeking to leverage the opportunities presented by the current market conditions are advised to adopt a prudent approach by exercising caution and adhering to a strict stop loss of 45,180.

This strategy will, therefore, help to mitigate any losses that may arise from sudden market movements, thereby reducing risk exposure.

In conclusion, the Nifty FMCG index presents a promising opportunity for traders to capitalise on the current bullish trend. The buy-on-dips strategy, with a target/resistance level of 46,025 - 46,400, and a strict stop loss of 45,180, is an optimal approach that can enable traders to realise maximum gains while minimising losses.

Nifty Metal
Last close: 5,679.25

The Nifty Metal index is likely to experience a period of consolidation and range-bound movement in the near future. The expected range for this consolidation is between 5,864 - 5,200, with any trade above or below this range potentially adding fresh triggers in the direction of the market.

Despite this, the overall trend of the index is negative, which suggests that it may underperform in the short term. Given the aforementioned negative trend, investors are advised to exercise caution when considering investment opportunities in this index.

Even if the index were to break through the upper band of the range, it is still advisable to hunt for opportunities to exit and book profits, as the index is expected to underperform. It is important to remain vigilant and exercise prudence when navigating the market, as there are potential risks associated with trading in an underperforming market.

The first support on short-term charts is expected to be around 4,850, which may serve as a critical level for traders to monitor closely. Any breaches of this support level could signal a bearish trend and may prompt further selling in the market.

In conclusion, the index is expected to undergo a period of consolidation and range-bound movement, with a range of 5,864 - 5,200.

Despite any potential triggers in the market, the overall trend is negative, and investors should approach it with caution when considering investment opportunities. The first support on short-term charts is expected to be around 4,850, which may be a critical level for traders to monitor.

(Ravi Nathani is an independent technical analyst. Views expressed are personal).