Time For Level-Based Trading

Mumbai: On Tuesday, the benchmark indices corrected sharply, with BSE Sensex was down by 1,018 points. Among sectors, all the major sectoral indices traded in negative territory, but the Capital Market index lost the most, shed over 3.70 per cent.

Technically, the market breached the 20-day SMA (Simple Moving Average) or 77,000 support level, and post-breakdown selling pressure intensified. It also formed a long bearish candle on daily charts, which supports further weakness from current levels.

Shrikant Chouhan, head (equity research), Kotak Securities, said: “We believe that the current market texture is weak, but oversold. Hence, level-based trading would be the ideal strategy for day traders.”

The 76,000 level would be the crucial support zone. If the market holds above this level, we could expect a quick pullback rally towards 76,500-76700. On the other hand, if it falls below 76,000, the selling pressure is likely to accelerate, and the market could slip to 75,700-75,500. Prashanth Tapse, senior V-P (research), Mehta Equities, said: “Indian markets underperformed global indices as benchmark indices plunged over one per cent each on wide-spread selling, mainly ignited by worries over escalating tariff war after Trump imposed 25 per cent import tariffs on steel and aluminium, which would hurt India’s business prospects.”

The mood is already sombre because of likely prospects of subdued government spending going ahead and dismal earnings show so far which has created uncertainty amongst the investors and prompted them to offload their equity holding.

STOCK PICKS

Carysil Ltd| TRADE-BUY | CMP: Rs673.70 | SL: Rs660| TARGET: Rs800

Carysil Ltd has tested a key trendline support near 680 on the weekly timeframe, signaling renewed buying interest and strength at lower levels. The stock exhibits a positive technical structure, positioning itself for a potential upside. Given the improving momentum, we anticipate an upward move toward 800 and beyond. The RSI (14) at 48 is showing early signs of an uptrend on the daily charts, further reinforcing the stock’s bullish outlook.

Imagicaaworld Entertainment Ltd| TRADE-BUY | CMP: Rs68.53 | SL: Rs65 | TARGET: Rs80

Imagicaaworld Entertainment Ltd has rebounded strongly from its anchor VWAP support at 66, indicating a potential trend reversal. The stock appears poised for an upward move, with immediate resistance near 75, followed by 80. A strict stop loss at 65 is advised for risk management. With rising RSI and a breakout above a key trendline, the stock is expected to gain strength in the coming sessions.

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