Traders baffled by wild swing but Nifty snaps weekly losing streak
It was a week of roller coaster moves as our markets witnessed many twists and turns
Traders baffled by wild swing but Nifty snaps weekly losing streak
It was a week of roller coaster moves as our markets witnessed many twists and turns. Initially the week started by bouncing from lower levels to test levels around 16400 and when every thing looked settled, the global selloff once again dragged our markets lower on the weekly expiry day back below the 15800 levels. Markets were however not done with its drama as on Friday once again we started with a massive gap up and with positive momentum throughout the day ended with gains of 2.89% and for the week with gains of 3% ended tad above 16250 levels.
The support levels around the 15700 played a sheet anchor role as it is a confluence zone of March swing low and 89EMA. This week Nifty finally snapped its weekly losing streak after five straight weeks and has formed a bullish weekly candle on the crucial 15700 support. This is finally some respite for the bulls and it was definitely on cards the way the oscillators were placed in the oversold zone. We have been mirroring the volatile moves in the US markets and if things settles down there then we can certainly expect this bounce to extend towards 16400 – 16600 zone. On the flip side, 16000 is seen as immediate support whereas 15700 remains a sacrosanct support. Seeing the volatility the traders are advised to avoid undue risk and have a very selective thematic approach.
Stock recommendations:
NSE Scrip Code – MARICO
View – Bullish
Last Close – Rs. 528.55
Justification – During the last week, FMCG counters were in buzz and many stocks from these space out-shined. If we analyze the price activity of this counter during the last week, we can see a trending up move supported by good increase in volumes. On the daily chart, prices have closed above 200SMA that were previously acting as hurdle and now indicates a change in polarity. Momentum oscillators are positively placed and strong bullish candles can be observed both on the daily and weekly chart. We expect the FMCG Index to continue outperform and this counter to be one of the charioteer of the move. Hence, we recommend a buy for a near term target of Rs. 572. The stop loss can be placed at Rs. 506.80.
2. NSE Scrip Code – ASHOKLEY
View – Bullish
Last Close – Rs.130.35
Justification – On the daily chart, stock prices have confirmed a bullish ‘Inv Head N Shoulder’ breakout. The said breakout is supported with a bullish gap that can be termed as a breakaway gap. In addition, we are witnessing a spurt in volume that augurs well for the bulls. On the weekly chart as well prices have broken out of key trend line resistance. RSI is positively placed across all major time frames and hence we expect the positive momentum in this counter. Looking at the entire above set up we recommend a buy in this counter for a near term target of Rs. 146. The stop loss can be fixed at Rs. 121.