Charts indicate indecisiveness
For the traders now, 77000 would be the immediate resistance level below which market could slip till 76100-76000. On the flip side, post 77000 breakout the index could move up to 77300-77400
Mumbai: On Monday, the benchmark indices witnessed narrow-range activity, while BSE Sensex was down by 203 points. Among sectors, Reality, and Media indices rallied over 1 percent whereas IT index was the top looser, shed 1.84 percent.
Technically, after a positive opening entire day the market hovered between 76400-77000. Intraday range bound activity and small bearish candle on daily charts after a strong rally indicates indecisiveness between the bulls and bears.
Shrikant Chouhan, Head Equity Research, Kotak Securities, said: “For the day traders now, the 77,000 would be the immediate resistance level as long as the market is trading below the same, the correction formation is likely to continue below the same, the market could slip till 76,100-76,000 points. On the flip side, post 77,000 breakout, the index could move up to 77,300-77,400 range.”
Volatility returned to markets, as Sensex slipped from its new high and fell sharply towards the close amid profit-taking in IT, metals and oil & gas stocks.
“Lacklustre sentiment also prevailed due to weak global cues after recent data from the US indicated that rate cut may not happen soon, however, with the Budget round the corner, stock and sector-specific action could be seen going ahead on hopes of tax sops or duty cuts,” says Prashanth Tapse, senior V-P (research), Mehta Equities Ltd
STOCK PICKS
Shree Cement Ltd
Trade: Buy Current Market Price (CMP): 27,239.70; Stop Loss (SL): 26,600; Target: 28,200
The stock has achieved a significant breakout from its wedge formation on the daily technical charts. Having surpassed its resistance level of 26,800 and with the RSI (14) crossing 65, the momentum appears strong. The stock is likely to move upwards towards 28,200 and potentially higher. However, it is crucial to maintain a strict stop loss at 26,600 to manage risk effectively.
INDIGO (InterGlobe Aviation Ltd.)
Trade: Buy Current Market Price (CMP): 4566.60; Stop Loss (SL): 4,490; Target: 5,000
The stock has broken out above its all-time high of 4,529 and continues to hold strong. With the RSI (14) surpassing 65, the momentum is robust, suggesting the stock could reach targets of 5,000 and beyond. Nonetheless, it is important to adhere to a strict stop loss at 4,490 to effectively manage risk.
(Source: Riyank Arora, technical analyst at Mehta Equities)
CMP (Current Market Price); SL (Stop Loss)/ All prices in Rs
