Day trading guide: Watch Nifty's follow-up action closely
With the shift to a higher base, the 11,200 level is likely to act as immediate floor; while sustenance above 11,400 level is essential for Nifty to make an attempt towards the 11,500 mark.
By ET CONTRIBUTORS | Updated:
Agencies
Amit Trivedi, Yes Securities
Nifty: Snapping three months winning streak, Nifty lost 1.2 per cent in September and during this decline, erased August month’s gains. However renewed buying interest emerged near the 45-week EMA, which was placed near the 10,800 mark. Continuing the prior session’s rise, Nifty opened on a gapup on Thursday and reclaimed the 11,400 level. It also retraced the 61.8 per cent of the previous entire decline; hence follow-up action needs to be watched closely. Nifty's breadth turned positive. Moreover all the sectoral indices ended positive. With the shift to a higher base, the 11,200 level is likely to act as immediate floor; while sustenance above 11,400 level is essential for Nifty to make an attempt towards the 11,500 mark.
Bank Nifty: Erasing prior two months' gains, Bank Nifty lost ~10 per cent in September. This week, it defended the 21,00 level on the downside and since then it has been trending higher gradually. In Monday’s trade, BankNifty formed a bullish candle and surpassed the 22,000 mark, which ensured a shift in the range on the upside. Bank Nifty snapped four weeks' losing streak. The positive follow-up action could continue the recent revival. The ratio of Bank Nifty vs Nifty is hovering near multi-year lowest zone. Any positive follow through could attract outperformance from the banking space in the near term.
Stocks: Buy side
DLF: Buy near Rs 156-154 with Stop loss of Rs 145 for an upside Target of Rs 175. The is on a verge to break above downward slanting trend line, positive follow-up through could attract momentum on the upside.
CEAT: Buy near Rs 990-1000 with Stop loss of Rs 940 for an upside Target of Rs 1,110. Post multi-months consolidation, eventually the stock has managed to surpass the hurdle zone near 980. Holding ground above current levels could attract further buying interest.
Nifty: Snapping three months winning streak, Nifty lost 1.2 per cent in September and during this decline, erased August month’s gains. However renewed buying interest emerged near the 45-week EMA, which was placed near the 10,800 mark. Continuing the prior session’s rise, Nifty opened on a gapup on Thursday and reclaimed the 11,400 level. It also retraced the 61.8 per cent of the previous entire decline; hence follow-up action needs to be watched closely. Nifty's breadth turned positive. Moreover all the sectoral indices ended positive. With the shift to a higher base, the 11,200 level is likely to act as immediate floor; while sustenance above 11,400 level is essential for Nifty to make an attempt towards the 11,500 mark.
Bank Nifty: Erasing prior two months' gains, Bank Nifty lost ~10 per cent in September. This week, it defended the 21,00 level on the downside and since then it has been trending higher gradually. In Monday’s trade, BankNifty formed a bullish candle and surpassed the 22,000 mark, which ensured a shift in the range on the upside. Bank Nifty snapped four weeks' losing streak. The positive follow-up action could continue the recent revival. The ratio of Bank Nifty vs Nifty is hovering near multi-year lowest zone. Any positive follow through could attract outperformance from the banking space in the near term.
Stocks: Buy side
DLF: Buy near Rs 156-154 with Stop loss of Rs 145 for an upside Target of Rs 175. The is on a verge to break above downward slanting trend line, positive follow-up through could attract momentum on the upside.
CEAT: Buy near Rs 990-1000 with Stop loss of Rs 940 for an upside Target of Rs 1,110. Post multi-months consolidation, eventually the stock has managed to surpass the hurdle zone near 980. Holding ground above current levels could attract further buying interest.
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L&T Finance: Buy near Rs 64-64.50 with Stop loss of Rs 59 for an upside Target of Rs 75. Swift recovery from multi-months lower levels, followed by a positive breakthrough above the descending trend line is likely to lift stock towards 75 zone. (Disclaimer: The opinions expressed in this column are that of the writer. The facts and opinions expressed here do not reflect the views of www.economictimes.com.)
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