Support at 20-day SMA to act as a trend setter
The benchmark indices witnessed a choppy intraday trading session on Monday. The market opened on a strong note, but due to lack of follow-through buying support, registered profit booking at higher levels.
image for illustrative purpose
Stock Picks
- ADANIENT: Above Rs1,748 with a target of Rs1,765 and Stop loss of Rs1,731. The stock is in upward trending channel and has given the breakout.
- ASAINPAINT: Above Rs3,165 with a target of Rs3,197 and Stop loss of Rs3,134. It has support of 8 and 40 EMA.
- BATAINDIA: Above Rs2,230 with a target of Rs2,252 and Stop loss of Rs2,208. The stock is in upward trending channel and is on the verge of a breakout.
- CHAMBLFERT: Above Rs357 with a target of Rs361 and Stop loss of Rs353. It has a support of 8 EMA.
- DMART: Above Rs5,025 with a target of Rs5,075 and Stop loss of Rs4,975. It has reversed from the support of 8 EMA.
(Source-CapitalVia)
Mumbai: The benchmark indices witnessed a choppy intraday trading session on Monday. The market opened on a strong note, but due to lack of follow-through buying support, registered profit booking at higher levels. Among sectors, after a long time, the buying interest was seen in pharma stocks, while the metal and PSU banks profit booking at higher levels. Technically, after a last Friday robust rally, on daily charts the index has formed small bearish candle which indicates temporary weakness, but at the same time, the index consistently taking support near 20-day SMA. And on intraday charts, it also maintained higher bottom formation which is broadly positive. "We are of the view that, now 20-day SMA would act as a trend decider level for the bulls, above the same uptrend formation is likely to continue up to 61,000-61,350," says Shrikant Chauhan, head of equity research (retail), Kotak Securities.
On the other side, dismissal of 60,500 or 20-day SMA could possibly open another correction wave till 60,350-60,000, he added. "We witnessed some lackluster movement in the market and an attempt to hold the level around the BSE Sensex 30 Index level of 60,700."
Our research suggests that sustaining above 60,600 will be an important level for the market to stay positive in the short term. If the market is able to sustain the level of 60,600, we can witness a positive momentum in the market which can lead to the higher levels near 60800 61100. We have observed the momentum indicators like RSI and MACD indicating positive momentum in the market, said another analyst
