Charts Signal Weakening Momentum

Mumbai: In the last session of the week, the benchmark indices witnessed a sharp sell off as BSE Sensex was down by 1,900 points. Among sectors, all the major sectoral indices traded in the negative territory, but Reality index lost the most shed nearly 10 per cent. During the week, market slipped below 20-day SMA (Simple Moving Average) and post breakdown the selling pressure had intensified. Technically on weekly charts, it has formed long bearish candle and also holding lower top formation which supports further weakness from the current levels.

Amol Athawale of Kotak Securities, said: “We are of the view that the current market texture is weak and if it break the 75,200 support zone then it could slip till 74,600-74,30.” On the other side, 76,500 important level to watch out. Above 76,500 we could see an extension of technical bounce back till 77,100-77,500.

Prashanth Tapse, senior V-P (research), Mehta Equities, said: “Benchmarks slipped below their crucial psychological levels of 76k and 23k in a volatile trading session as investors in absence of any positive cues continue to book profits in frontlines and sectoral stocks.”

The gloomy mood continued as investors are perturbed by lingering foreign fund outflows and the falling rupee against the dollar, which has thus dampened the sentiment.

Rajesh Sinha, research analyst at Bonanza said that the decline was attributed to multiple factors, including ongoing fears surrounding US inflation and trade tensions. Investors reacted negatively to US President Donald Trump’s proposals for reciprocal tariffs, which have raised concerns about potential impacts on bilateral trade with India.

STOCK PICKS

ITC| TRADE-BUY | CMP: Rs390-400 | SL: Rs370 | TARGET: Rs440 - 450

ITC is currently trading near a strong support zone of Rs390-400, forming a solid base for a potential upward move. With increasing trading volumes and stable price action, accumulating in this range presents a favourable opportunity for long-term gains. The recent decline has pushed the stock into slightly oversold territory, making it an attractive buy at current levels.

Hindustan Unilever (HUL)| TRADE-BUY| CMP: Rs2300 | SL: Rs2200 | Target: Rs2500 - 2600

HUL has retraced to a crucial support level of Rs2300, providing a good entry point for long-term investors. With RSI stabilizing and early signs of a reversal on technical charts, the stock is well-positioned for a move towards Rs2,500-2,600. Given the strong outlook for the consumption sector, HUL remains one of the safest investment bets. Investors should buy on dips to capitalize on future growth potential.

(Source: Riyank Arora, technical analyst at Mehta Equities)