Sensex can hit five sixes in few months, says Sumeet Bagadia

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Chartist Sumeet Bagadia of Choice Broking believes that the benchmark BSE Sensex can hit 66,666 in the next few months. He added that the index has been flying above the Ichimoku Cloud and Bollinger Band formation. Besides, supportive indicators like Relative Strength Index (RSI), Stochastic and MACD suggest an upside rally for the near term. The 30-share index traded nearly 60 points down at 59353 ahead of F&O expiry on Thursday.

The BSE Sensex has been on a rising journey since the Covid lows of March 2020. A couple of factors including high liquidity, inflows by foreign institutional investors and better than expected quarterly results supported the market sentiment during 18 months. Earlier, during the Covid period in March last year when there was a lockdown imposed in the country, the index hit a low of 25,638.90 to an all-time high at 52,516.76 till February 2021. The index gained more than 104% in a one-year timeframe. After that, the index slipped over 10% from the all-time high to 47204, scaled in April 2021.

Thereafter, Sensex resumed the gains and consolidated in the month of June and July between the range of 51,450 and 53,290. Finally, the index gave a breakout in August 2021 from 52901.28 towards a new milestone of 59737.32 levels, gaining more than 6,500 points in just one and a half months. After that, the market witnessed slight profit booking in the mid of September from 59737.32 to 58232.53, dragging almost 1500 points. Meanwhile, the index set a new milestone of over 60,000-mark.

“If we focus on the medium-term time horizon, the rally could extend till 64,444 which is 61.8% Finonacci Extension of the rally. Some upward or downward movement could be seen while reaching a new milestone, but every dip will be a good opportunity for investors. The rally is likely to continue till 66,666, which is 100% extension of the recent journey,” said Bagadia.