Profit booking likely at higher levels now
For now, 79,000 would act as a sacrosanct support zone, immediate profitbooking at 79,700-80,000; On the flip side, below 79,000 level, traders may prefer to exit out from long positions
image for illustrative purpose
Mumbai: On Monday, the benchmark indices witnessed a positive momentum as NSE Nifty ends 131 points higher, while BSE Sensex was up by 443 points. Among sectors, Media index was the top gainer, rallied 2.40 per cent whereas selective PSU Banks and Energy stocks witnessed intraday profit booking at higher levels. Technically, after muted open the market took the support near 79,000 and bounced back sharply.
On daily charts, it has formed bullish candle and on intraday charts, it is holding higher bottom formation, which is largely positive.
“We are of the view that, the short-term texture of the market is positive, but due to temporary overbought conditions, we could see some profit booking at higher levels,” said Shrikant Chouhan, head (equity research), Kotak Securities.
For traders now, the 79,000 would act as a sacrosanct support zone. While 79,700-80,000 could be the immediate profit, booking zones for the day traders. On the flip side, below 79,000 traders may prefer to exit out from the trading long positions.
“Markets slipped into the red in early trades, but soon reversed the trend to trade higher as positive Asian and European cues fuelled recovery amid buying in banking, IT and telecom stocks,” says Prashanth Tapse, senior V-P (research), Mehta Equities. While there has been no negative news on economic parameters, investors are closely watching developments on the patchy monsoon so far and the upcoming Budget.
STOCK PICKS
Cosmo First | Buy | CMP: 814.65 | SL: 790 | TARGET: 850
The stock has given a strong breakout from its NR7 pattern formation on daily time frame charts. The strong surge in volumes shows an extremely positive sign for the stock, and it should likely head towards 850.00 and above. The RSI(14) on daily charts, being around 80, indicates strong momentum for the stock. A strict stop loss should be set at the 790 mark to manage risk well.
Persistent Systems | Buy | CMP: 4496.15 | SL: 4,380 | TARGET: 4,700
The stock has given a strong breakout above its all-time high resistance mark of 4,450 and successfully managed to close above it. With volumes surging and the price witnessing a strong close above all possible resistances, the stock looks poised for an up-move towards 4,700 and above. A stop loss should be set at the 4,380 mark to manage risk well on this trade.
(Source: Riyank Arora, technical analyst at Mehta Equities)
CMP (Current Market Price); SL (Stop Loss)/All prices in Rs
