Large-cap stocks could attract more attention
73,100 would be the trend decider level. As long as market is trading above the same, the bullish formation is intact, below which the texture could change and the index could slip till 73,600-72,400
image for illustrative purpose
Mumbai: In this truncated week, the benchmark indices witnessed a strong momentumwith Sensexrising 655 points.Among sectors, reality, infra, oil &gas indices outperformed rallied over 2 per cent whereas media index lost the most, shedding 2.7 per cent.
Technically, on daily and intraday charts, the market is holding higher bottom formation and on weekly charts, it has formed long bullish candle which is largely positive.
For the trend following traders now, 20-day SMA (Simple Moving Average) or 73,100 would be the trend decider level. As long as market is trading above the same, the bullish formation is intact.On the higher side, the index could find the resistance near 74,200-74,600.However, below 20-day SMA or 73,100, the texture could change. Below which the index could slip till 50-day SMA or 73,600-72,400.
“For Bank Nifty, the technical setup is bullish and for the traders now 20-day SMA or 47,000 could be the important reference point for the short-term traders,” says Shrikant Chouhan, Head Equity Research, Kotak Securities. Above 47,000, it would rally till 47,500-47,800. On the flip side, below 20-day SMA uptrend would be vulnerable.
Prashanth Tapse, Senior VP (Research), Mehta Equities, says, “While markets may witness wild fluctuations due to valuations of benchmark indices being in an expensive zone, the undertone still remains bullish as investors are willing to bet big on equity assets for the next financial year too.”
While focus will shift to full year earnings from next month, sectors like banking and IT companies will be in focus, going ahead. Although corrections at every interval will provide investors an opportunity to revisit mid & small-cap stocks, large-cap stocks could attract more attention going ahead.
Stock Picks
Kotak Bank
CMP: 1785.50 | Stoploss: 1750.00 | Target: 1850.00
The stock has given a good breakout above its anchor vwap resistance mark of 1780 on daily charts. With a good pickup in volumes and the overall outlook on banking stocks being bullish, the stock looks poised for a good upside move towards 1850 with a strict Stoploss to be kept at 1750 levels.
Sandhar Technologies
CMP: 525.00 | Stoploss: 490.00 | Target: 575.00
The stock has given a good breakout above its recent swing high resistance mark of 517.00 on its daily charts and managed to give a closing above the same. Overall, with a good volume pick-up on the stock, the stock looks poised for an upside rally towards 575 and above, with a strict stoploss kept at the 490 mark.
(Source_Riyank Arora Technical Analyst at Mehta Equities)
