Charts indicate indecisive trading
74,000 would be the immediate breakout level, above which the market could rally till 74,300-74,500 range; On the flip side, below 73,500 level, the market could retest the level of 50-day SMA or 73,200-73,050
image for illustrative purpose
Mumbai: On Tuesday, the benchmark indices witnessed a consolidation at higher levels as BSE Sensex up by 90 points. Among sectors, Reality index gained 2.58 per cent, whereas Pharma index shed nearly one per cent.
Technically, after a sharp bounce back, the Sensex witnessed a narrow-range activity near 20-day SMA (Simple Moving Average). On daily charts, the index has formed small bearish candle, which clearly suggesting indecisiveness between the bulls and bears. “We are of the view that currently the market witnessing a non-directional activity perhaps traders are waiting for either side breakout,” says Shrikant Chouhan, head (equity research), Kotak Securities.
For the bulls now, the 74,000 would be the immediate breakout level, above which the market could rally till 74,300-74,500 points. On the flip side, below 73,500 level, the selling pressure is likely to accelerate. Below the same, the market could retest the level of 50-day SMA or 73,200-73,050 points.
Prashanth Tapse, senior V-P (research), Mehta Equities, says: “Markets pared most of their early gains due to profit-taking in late trades, but managed to extend its winning streak for a third straight session led by a strong upsurge in telecom stocks.” In a phase of prolonged uncertainty due to lingering geo-political tensions, rising crude prices, and haze over rate cuts going ahead, investors prefer redeeming their bets at regular intervals and rather take selective longish bets when valuations get attractive.
CMP (Current Market Price); SL (Stop Loss)/ All prices in Rs
STOCK PICKS
Grasim Industries
CMP: 2370.15 | SL: 2,325 | Target: 2,500
The stock has given a strong breakout above its all-time high mark of 2,323 on its daily timeframe charts and successfully managed to close above the same. With the overall chart structure being positive and RSI (14) on the daily timeframe around 65.88, the overall momentum looks strong, and the stock is poised for a strong up-move towards 2,500 and above. A strict stop-loss should be kept at the 2,325 mark to manage risk well.
Bharti Airtel
CMP: 1,342.35 | SL: 1,315 | Target: 1,400
The stock has given a strong breakout above its parallel channel resistance mark of 1,320 on its daily as well as weekly timeframe charts. With the RSI (14) on charts being near 76.87, the overall momentum looks strong, and the stock is poised for an upmove towards 1,400 and above. A strict stop-loss should be kept at the 1,315 mark to manage risk well.
(Source_Riyank Arora Technical Analyst at Mehta Equities)
