Nifty outlook and four trading ideas by Devang Shah for today's session

Short-term outlook for the market remains positive till Nifty trades above 9,685, says Devang Shah

NIFTY       

CLOSE- 9837.40 (19.08.17)

Market closed the week in a positive territory. It witnessed high volatility on both sides during week. It made a high of 9,947.80 levels and low of 9,783.65 levels during week. It still looks like bullish consolidation till short term reverses. We have seen sharp “V” shape recovery particularly Midcap and Small cap Index during this week after sharp fall of preceding week. It still looks like one more leg on upside is still pending in the short-term till it reverses. Alternatively, failing to sustain at higher levels will lead to a range-bpund trend between 9,500-10,000 levels on Nifty in the short-term. Any kind of decline is stock specific buying opportunity from short to medium term perspective.

Midcap and Small cap index closed the week in a positive territory. It has completed wave-C of IV in these correction. It has still wave-V of 3 is pending as per monthly chart. It may show some out performance  if main index remains in range. One should closely watch out these index behavior in the short-term to get some more clue of market.

Short-term outlook for the market remains positive till Nifty trades above 9,685 levels and is expecting target of 10,400 levels in the short-term. Medium term outlook for the market remains positive till Nifty trades above 8,968 levels and is expecting targets in the range of 12,000-12,200 levels in the medium term.

Market is still holding Dow Theory support on weekly charts. As mentioned many times in my updates about relevance of such supports in these kind of extended markets. At least for immediate short-term, recent lows of 9,685 on Nifty and 31,128 on Sensex are strong support for trading perspectives.

9,500-10,000 levels in strong support and resistance levels respectively on Nifty based on derivative option open interest data for expiry perspectives for this month. Any kind of decline or short term consolidation is buying opportunity for medium to long-term till medium term reverses.

Bank Nifty also closed the week in a positive territory. We have seen profit-booking on Bank Nifty from higher levels. It remained under-performer so far in this pull-back rally. One needs to watch out Bank Nifty behavior in coming trading session to take further clue on the short-term trend. It made a low of 23,933.10 levels. It has to participate for short-term rally to continue further from here on. It has one more leg on the upside and is still pending towards short term targets levels till it reverses. Alternatively, It may also remain in a range between 23,900-24,900 levels in the short-term. It has strong support around 20,649 levels till it holds one can expect higher levels targets till 27,000 levels in medium term.

Momentum indicators Daily KST & daily MACD both are in SELL showing weakness but one should be stock specific and follow the trend with trail stop loss levels till it reverses from trading perspectives. Close below short term reversal levels will lead to possible sharp price wise correction till 9,480/9,270 levels on Nifty and 30,680/29,800 levels on Sensex in short-term. 

Stock Picks:

PIDILITE: BUY
 

CLOSE: Rs 819.25

TARGET: Rs 840/850

Pidilite closed the week in a positive territory. It is outperforming in the short term. It has still wave-V up pending on daily chart. It managed to hold 20-DMA. Risk-reward is favorable to buy at current levels. Momentum indicators are in BUY. One can buy with a stop loss of Rs Rs 800 for the target of Rs 840/850 levels in short term.

DABUR: BUY
 

CLOSE: Rs 311

TARGET: Rs 320-325

Dabur closed the week in a positive territory. It is outperforming in short-term. Its momentum indicators are in BUY. Risk reward is favorable to buy at current levels. One can buy with stop loss of Rs 300 for the target of Rs 320/325 levels in short-term.

ITC: BUY
 

CLOSE: Rs 281.80

TARGET: Rs 290/295

ITC closed the week in a positive territory. It looks like the end of short-term correction. Risk-reward is favorable to buy at current levels. Its momentum indicators are in BUY. One can buy with stop loss of Rs 270 for the target of Rs 290-295 levels in the short term.

DHFL- BUY
 

CLOSE: Rs 449.50

TARGET: Rs 480

DHFL closed the week in a positive territory. Its outperforming in the short term. It has completed short term correction. Risk-reward is favorable to buy at current levels. One can buy with a stop loss of Rs 420 for the target of Rs 480 levels in the short term.

Devang Shah: The author of www.trendtechno.com (Trade with Trend) and an independent market analyst

Disclaimer: The analyst may / may not have a position in the scrips mentioned above; the views given above are the personal views of the analyst.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.