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The Nifty on Wednesday ended 0.13 percent higher at 10,856.70. It opened on a stronger note but remained stuck in a narrow price band before ending the session on an indecisive note. The candle pattern suggests it may again retest its downside pivotal support placed around 10,800 levels, if it fails to sustain above the critical resistance placed around 10,880 levels (Wednesday’s high was 10,893). Hence, staying cautious on a rise is advised. The Nifty is expected to trade in a 10,800-10,880 range today.
On the Nifty hourly chart, triple top formation in the relative strength index (RSI) while price continue to make higher highs is pointing towards negative divergence. This may lead to an intraday correction towards 10,800 levels.
Nifty patterns on multiple timeframes show it opened on a positive note but finally ended nervous. The candle pattern suggests it may again retest its downside critical support placed around 10,800 levels. Considering the broader trend, we prefer a buy on dips.
The Bank Nifty on Wednesday ended 0.13 percent higher at 26,642.80. It ended the session with a bearish Spinning Top candle. Downside pivotal support is placed around 26,300 while upside resistances are placed around 26,800 and 26,900.
Bank Nifty Fut weekly expiry:
Bank Nifty 'Option Chain' analysis in terms of percentage change in OI (at the end of yesterday's session)- Bank Nifty Fut (CMP- 26,637.30) ended in around 5 points discount against Bank Nifty (CMP- 26,642.80).
Maximum long OI build up in 26,900-PE followed by 26,800-PE, 26,700-PE and, 26,600-PE against minor long OI build up in 26,900-CE, 26,800-CE and, 26,700-CE ahead of today’s expiry suggests, Bank Nifty Fut is likely to face intraday selling pressure on rise around 26,900.
Opinion- Bank Nifty Fut is likely to see intraday selling pressure on rise around 26,900. Below 26,600 further correction towards 26,300 is likely. On a similar note, intraday trend is expected to remain volatile within the price band of 26,900-26,300.
This view is subject to change if and only if Bank Nifty Fut starts moving decisively above 26,900.
Based on a thorough technical study, the research firm recommends Glenmark Pharma for the short term:
Glenmark Pharma | Rating: Buy | Target: Rs 610, stop loss: Rs 550, Return: 7%
After a stupendous pullback in last couple of sessions, the stock has again come down to the critical support placed around Rs 570 levels. It is also trading above 30 EMA on the weekly chart.
Based on the above mentioned observations, the firm recommends Glenmark as a buy on dips for the short term upside target of Rs 610.
Disclaimer: The author is Technical Analyst at Stewart & Mackertich Wealth Management Ltd. The views and ideas expressed above may have been suggested to the clients of Stewart & Mackertich Wealth Management Ltd. It is advised that investors/traders should consult with their Certified Experts before taking any investment decision.