Level-based trading will be an ideal strategy
So long as Sensex trades above 76,300, bullish sentiment is likely to continue, above which it may move up to 77,600-78,000.
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Mumbai: The positive undertone of the market helped benchmark to new highs. Investors continued with their select buying approach in key frontline stocks. However, midcap & smallcap stocks have been seeing renewed buying interest with large-cap stocks facing higher valuation hurdles.
“As expectations start building up from the government in the run up to the Budget next month, markets may face bouts of intra-day volatility going ahead,” says Prashanth Tapse, Senior VP (Research), Mehta Equities Ltd. This week, the benchmark indices witnessed a narrow range activity. Sensex was up by 299 points. Among sectors, reality index outperformed, rallying by over 5 per cent whereas IT index shed 1.6 per cent.
Technically, after a last week stellar uptrend rally the market witnessed range bound activity. On the lower side, market consistently took support between 76,300-76,550 whereas it witnessed some profit booking between 77,000-77,100 levels.
Amol Athawale, VP-Technical Research, Kotak Securities, said: “We are of the view that currently market is witnessing positive consolidation and as long as it is trading above 76,300 the bullish sentiment is likely to continue. On the higher side, post 77,150-breakout market likely to move up to 77,600-78,000.” However, below 76,300 the texture could change. Below the same, short-term traders may prefer to exit from the trading long positions. Below 76,300, the chances of hitting 76,000-75,700 would turn bright. The intraday market texture is non-directional hence level based trading would be the ideal strategy for the traders.
STOCK PICKS
Indian Hume Pipe
BUY | CMP: 384.50 | SL: 360.00 | TARGET: 425.00
The stock has given a strong breakout above its important resistance mark of 369.90 and successfully managed to close above this level. With volumes surging to almost four times its average 30-day traded volume and the stock approaching the next overhead resistances, it looks like a good buy with a strict stop-loss of 360.00 for potential upside targets of 425.00 and above.
Bajel Projects
BUY | CMP: 300.25 | SL: 275.00 | TARGET: 350.00
The stock has given a strong breakout above its all-time high mark of 296.00 and successfully managed to close above this level. With volumes surging to nearly four times its average 30-day volume and the RSI (14) witnessing a good upside tick, crossing the 65.00 mark on the daily charts, the stock is set for an upside move towards 350.00 and above. A set stop-loss should be kept at the 275.00 mark to manage risk well.
(Source_Riyank Arora Technical Analyst at Mehta Equities)
