“Over the next couple of days, the Nifty should head towards 26,500, which is an important breakout level. This corresponds to the trend line connecting the previous highs seen between October and November,” Srivastava said. A move above 26,500 could open the door for stronger momentum ahead of the monthly derivatives expiry.
IT stocks: short-term trade, long-term caution
On the IT sector, which came under pressure following reports around changes to the US H-1B lottery system, Srivastava struck a cautious tone from a long-term investment perspective. He noted that IT stocks have historically underperformed broader markets during growth cycles, especially given modest earnings growth expectations of 8–12% for large-cap IT companies.
“From a trading perspective, the current dip can still be seen as a buying opportunity. The IT index could move towards 40,000 or slightly higher in the short term,” he said, while advising investors to remain selective and cautious on longer-term allocations.
Santa rally focus: metals in spotlight
Looking ahead to the final week of December and the possibility of a Santa rally, Srivastava said global cues remain supportive, with strength seen across Asian markets and Wall Street. For India, however, his preference lies firmly with the metals space.
“The environment is gradually turning favourable for commodities, with a weakening US dollar and rising prices of metals like copper and aluminium,” he said. Stocks such as Hindalco and National Aluminium, which have already shown strong momentum, could continue to outperform in the near term.
Overall, Srivastava advised investors to stay selective, watch key technical levels closely, and align short-term trades with sectors benefiting from global macro tailwinds.