At the close of a week of brisk trading, the Nifty gained nearly 2 percent and made a remarkable return to the above -19,800 zone at the end of Friday.
Several contributors have led to the recent rally, be it on the technical or the macro front. The recent entrants to the rally were the heavyweights and the high-beta index Bank Nifty, which took the leadership and is likely to sustain the momentum in the near term. The G20 Summit has also provided the thrust to levitate market sentiments, adding to the bullish undertone.
Technically, the Nifty eyes the 20,000 milestone now and, with the ongoing momentum, it would be barely a task for the bulls to pull it off. Also, keeping the view on consecutive rallies, one should not become complacent and wait patiently for dips to initiate fresh longs in the system.
As far as levels are concerned, 19,700 should now act as an immediate support, followed by sacrosanct support at 19,600-19,500 in the comparable period.
Here on, the undertone seems upbeat with ‘buy on dips’ being the most suitable approach. Also, one must closely watch global developments alongside the domestic overview for the immediate trend setup.
Sectoral rotation is quite evident with strong thematic moves, which one needs to gauge for an outperformance in the market.
Here are two buy calls for short term:
CDSL: Buy | LTP: Rs 1,282.3 | Stop-Loss: Rs 1,218 | Target: Rs 1,395 | Return: 8 percent
Central Depository Services (CDSL) has seen a decisive spurt in price-volume in the last couple of trading sessions. The recent price structure construes a ‘Cup and Handle’ pattern formation breakout on the daily chart, adding to a robust view in the counter.
Also, the primary technical indicators align with the price movement, suggesting continuation in the northward journey for the counter in the comparable period.
Hence, we recommend buying CDSL around Rs 1,270-1,280, with a stop-loss of Rs 1,218 and for a target of Rs 1,395.
Rain Industries: Buy | LTP: Rs 180.40 | Stop-Loss: Rs 172 | Targets: Rs 190-192 | Return: 6.4 percent
Rain has seen a buoyant upmove on the back of robust trading volumes in the last couple of trading sessions. At present, the stock is firmly placed above all its EMAs (exponential moving average) and has also surpassed the crucial resistance of Rs 170-172 in a decisive manner.
The rebound was backed by a notable increase in average traded volumes, supporting the bullish bias in the counter. Technically, the stock looks sound and likely to carry upward momentum.
Hence, we recommend buying Rain Industries around Rs 178-180, with a stop-loss of Rs 172 and targets of Rs 190-192.
Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.