In a bear grip, Nifty may see 11,000-10,800 levels
Dollar/rupee is showing strong support around the 70.50 levels.
By ET CONTRIBUTORS |
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By Vishal Wagh
Research Head, Bonanza Portfolio
Where we are: The chart setup is currently showing a bear grip. The Bank nifty and Nifty Auto are under performing the Nifty on a broader basis. Further downside in both sector indices cannot be ignored. Nifty IT is showing some resilience and some buying was witnessed on the last day of trading this week. The highest open interest build-up is seen in 11000 PUT and 11500 CALL. Gold has completed its corrective wave and is ready for a further rally. Dollar/rupee is showing strong support around the 70.50 levels.
What is in store: The markets are in a bear grip and lows of 11,000-10,800 levels can be seen before the bulls try to defend their territory. On the higher side 11,550-11,600 will work as the resistance level. Auto, banking and NBFCs may continue to lead the correction.
FMCG and IT may create a buy opportunity owing to their defensive play.
What could investors do: In a market scenario where the bears have an upper hand, one should avoid going long on high-beta stocks. This is also the time when one should hedge her portfolio by going long on gold and dollar/rupee. In equities, one can go long on FMCG and IT stocks. Investors can go long on stocks such as Nestle, Colgate-Palmolive and NIIT Technologies. On the short side, banking & NBFC should be preferred. Stocks like IndusInd Bank and State Bank of India have bearish setups.
Research Head, Bonanza Portfolio
Where we are: The chart setup is currently showing a bear grip. The Bank nifty and Nifty Auto are under performing the Nifty on a broader basis. Further downside in both sector indices cannot be ignored. Nifty IT is showing some resilience and some buying was witnessed on the last day of trading this week. The highest open interest build-up is seen in 11000 PUT and 11500 CALL. Gold has completed its corrective wave and is ready for a further rally. Dollar/rupee is showing strong support around the 70.50 levels.
What is in store: The markets are in a bear grip and lows of 11,000-10,800 levels can be seen before the bulls try to defend their territory. On the higher side 11,550-11,600 will work as the resistance level. Auto, banking and NBFCs may continue to lead the correction.
FMCG and IT may create a buy opportunity owing to their defensive play.
What could investors do: In a market scenario where the bears have an upper hand, one should avoid going long on high-beta stocks. This is also the time when one should hedge her portfolio by going long on gold and dollar/rupee. In equities, one can go long on FMCG and IT stocks. Investors can go long on stocks such as Nestle, Colgate-Palmolive and NIIT Technologies. On the short side, banking & NBFC should be preferred. Stocks like IndusInd Bank and State Bank of India have bearish setups.
(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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