Edited excerpts from a chat:
The sharp sell-off in the previous 3 sessions clearly upset the bulls who believed that the market may have made peace with war. How have your calculations changed in the last 3 days?
The last three days have been volatile as the index slipped sharply on the back of renewed tension talks between the US and Iran. Rising crude and a falling rupee magnified the weakness in Indian equities. On the higher end, the index found resistance at the 89 EMA on the daily timeframe, and the rally got arrested there, leading sellers to come in and push the index below 24,000. Now, we are again set for a bearish trend where Nifty looks ready for a fall towards 23,500. On the higher end, 24,200 would be the immediate resistance, above which market sentiment might improve.
IT index is suddenly the worst performer again with 10% weekly loss amid weaker-than-expected guidance given by software exporters. Will the bear’s play get stronger?
Nifty IT witnessed a return of bears as the index attracted heavy selling on Friday following the quarterly numbers from Infosys. Lately, the index found rejection at the 50 EMA on the daily timeframe. The RSI has entered a bearish crossover and is falling. On the lower end, the index might continue to fall towards lower levels. Support is placed at 25,500, while resistance is at 32,000.
HCL Tech was among the worst losers in the week. What should traders do in the week ahead?
The stock has fallen with the formation of a lower top on the daily chart. The volume in the last few days has been higher compared to the preceding days, signifying higher participation in selling. The sentiment looks weak, and any rise could be sold into. On the higher end, it might move towards 1,275–1,300, where sellers might come back again. On the lower end, support is placed at 1,000.
RIL shares would be in focus on Monday morning. Given that the stock is down 16% this year already, what are the charts indicating for the week ahead?
RIL has been remaining weak for the last few days, with every rise being sold into, keeping the stock below the 200 DMA. The longer-term trend remains weak for the stock. The RSI is in a bearish crossover. On the higher end, Rs 1,400 might remain as resistance; a move above Rs 1,400 could change the trend in the stock.
Pharma stocks suddenly become a strong defensive play. How do you see the momentum in stocks like Piramal Pharma and DRL going forward?
Pharma has been in a broad consolidation, as the index has not gone anywhere in the last one year. On Thursday, it witnessed a powerful rally but failed to capitalise on it, as on Friday it came back, trapping buyers. In my view, the index might remain range-bound without any directional move in the short term as well.
Share your top trading ideas for the week ahead.
Buy NMDC 89.29 | SL 86 | TGT 95
The stock has been in an uptrend after a large consolidation breakout. Besides, it has been sustaining above the critical moving average, the 50 EMA. The RSI is in a bullish crossover. The setup suggests a continuation of the uptrend in the short term. On the higher end, the stock might move towards 95, while on the lower end, it has support at 86.
Buy RBL 321.40 | SL 310 | TGT 340
Though the stock has been in a larger consolidation on the daily chart, sentiment has improved in the near term following a consolidation breakout on the smaller timeframe. The RSI has re-entered a bullish crossover. The overall sentiment remains strong and is likely to push the stock higher. On the higher end, it might move towards 340, while on the lower end, support is placed at 310.
Buy Piramal Pharma 165.50 | SL 160 | TGT 174
The stock has been consolidating after a steep rise, which is a normal phenomenon. It has reclaimed the 50 EMA, confirming an uptrend. The RSI is in a bullish crossover and rising. Over the short term, the stock might remain in an uptrend with the potential to rise towards 174, while on the lower end, support is placed at 160.
(Disclaimer: The recommendations, suggestions, views, and opinions given by the experts are their own. These do not represent the views of The Economic Times.)