Expect targets of 10,300-10,700 levels in Nifty, says Devang Shah

Nifty outlook and stock pics from Devang Shah for Monday

NIFTY          
CLOSE- 9,119.40 (21.04.17)
 
Market consolidated in narrow range for the entire week. It failed to sustain at higher levels but still managed to hold lower end support/ reversal levels as mentioned below as per Dow Theory indicating time wise correction phase of market till its proven otherwise. Main indices Nifty/Sensex closed 2nd consecutive week in negative territory, indicating possibility of Wave-II Time wise correction phase as per wave counts on daily chart. It made a high of 9,217.90 & low of 9,075.15 levels during the week. One should expect market to trend towards higher levels targets till it reverses.

 
All the other indices such as Bank Nifty, Midcap and Smallcap are out performing in short term. Midcap & Small cap indices closed weekly in positive territory. Its good sign at current levels of market supporting short term view but now main indices such as Nifty & Sensex has to catch up with these indices or else it will be Inter market Divergence as a warning sign in advance ahead of major pricewise  short term correction.

 
Short-term outlook for the market remains positive till Nifty trades above 9,020 levels and is expecting targets in the range of 9,300-9,390/9,465 levels in short term. Medium term outlook for the market remains positive till Nifty trades above 8,327 levels and is expecting targets in the range of 10,300-10,700 levels in medium term.

 
Bank Nifty closed weekly in negative territory. It also looks like possibility of wave-II Time wise correction as per wave counts on daily charts. 20800 is strong support/reversal levels for Bank nifty in short term. One needs to also watch out these indices behaviour as a further evidence for short term trend of market.
 
FII data showing long unwinding positioning in futures market & also showing selling figure in cash market as profit booking for this week, is showing weakness & also warning sign in advance but one needs to watch out short term reversal for final confirmation of trend reversal.

 
Bank Nifty is still outperforming in short term as per daily chart attached. 20,800 is strong support for bank nifty in short term. One can expect revised higher levels target of around 22800 as per daily chart attached in short term till it reverses
 
8,900-9,000/9200 levels in strong support & Resistance levels respectively on nifty based on derivative option open interest data for short term. Market will remain volatile ahead of expiry next week, any kind of short term correction or consolidation in buying opportunity for medium to long term investor. One can expect higher levels targets in medium to long term.

 
Momentum indicators Daily KST & daily MACD both are in SELL indicating weakness but one should be stock specific & follow the trend with trail stop loss levels till it reverses from trading perspectives. It may remain in range bound between 9,000-9,200 levels ahead of expiry next week before further trend established in short term. Close below short term reversal levels will lead to possible sharp correction till 8,860 levels on nifty & 2,8700 levels on sensex in short term. 
 
Stock Picks:
 
L&T -BUY
CLOSE-Rs 1,687
TARGET- Rs 1,760
  
L&T closed the week in a positive territory. It’s closed above 20 DMA. Its weekly momentum indicators are in BUY. Risk reward is favourable to BUY at current levels. One can BUY with a stop loss of Rs 1,615 for the target of Rs 1,760  levels in short term.

  
PIDILITE - BUY
CLOSE-Rs 712.15
TARGET –Rs 728-745
 
PIDILIE closed the week in a positive territory. It’s outperforming in short-term. It closed above 20-DMA. Risk reward is favourable to BUY at current levels. Its momentum indicators are in BUY. One can BUY with a stop loss of Rs 690 for the target of Rs 728-745 levels in short-term.
  
POWER GRID - BUY
CLOSE- Rs 205.60
TARGET- Rs 213
  
POWERGRID closed weekly in positive territory. Its momentum indicators are in BUY. It closed above 20 DMA. It’s outperforming in short term. Risk reward is favourable to BUY at current levels. One can BUY with SL-202 for the target of 213  in short term.

 
GODREJ IND-BUY
CLOSE-Rs 527.85
TARGET-Rs 550
 
GODREJ IND closed weekly in negative territory. It closed above 20 DMA. Its weekly momentum indicators are in BUY. Risk reward is favourable to BUY at current levels. One can BUY with SL-515 for the target of 550 in short term.
 
BHARATFORGE - BUY
CLOSE – Rs 1,077.80
TARGET - Rs 1,200
 
BHARATFORGE closed weekly in negative territory. It’s consolidated in narrow range for the entire week. Its weekly momentum indicators are in BUY. Risk reward is favourable to BUY at current levels. One can BUY with SL-1040 for the target of 1200 in short term

 
 
Devang Shah: The author of www.trendtechno.com (Trade with Trend)
 
Consultant & Advisors in the world of Financial Market.
 
Disclaimer: The analyst may have a position in the scrip mentioned above; the views given above are the personal views of the analyst.