Short-term outlook for the market remains positive: Buy IOC, Granules India

NIFTY      

CLOSE- 10780.55 (25.01.2019)

The market closed weekly in negative territory. It’s consolidating in a narrow range for another week. It made a high of 10987.45 levels during the week. It’s still trading in a narrow range of 10500-11000 levels from one month. It has shown weakness across the board at the end of weekly trading session. But I will wait for further confirmation to finally conclude the end of the short term trend reversal. One should watch out market behavior near these crucial levels. Able to break this range on the upside will finally confirm the trend towards higher levels targets as mentioned below in short term. 

Short term wave count is still not conclusive or keep on varying but overall medium-term wave counts is indicating an ongoing correction is buying opportunity from medium to long term perspectives. 

The short-term outlook for the market remains positive till Nifty trades above 10692 levels and expecting targets in the range of 11000-11300 levels in short term. Medium term outlook for the market remains positive till Nifty trades above 9951 levels and expecting targets in the range of 12500-12800 levels in the medium term.

It may further remain in the broad range between 10000-11000 levels on nifty for some more time in the short term before giving a breakout on the upside. One should closely watch out the upper end of the range at the current level of the market for further confirmation of the same.

BANK NIFTY also closed weekly in negative territory. It made a high of 27675 levels during the week. It’s also traded in a narrow range for the week. It’s still consolidating in a narrow range of 26400-27500 levels for short term. Able to break this range on the upside will finally confirm the trend towards higher levels targets. 26400 is strong support for short term till it holds one can expect higher levels targets till 28500 levels for short term. 23600 levels is strong support on bank nifty from medium-term perspectives till it holds one can expect higher levels targets in the range of 30000-32000 levels in the medium term.

10500 & 11000 levels are strong support & resistance levels respectively based on option open interest data for current month series. Any kind of such short term correction or consolidation is stock specific buying opportunity for medium to long term Investment perspectives till medium term reverses.

Momentum indicators Daily KST & DAILY MACD are in sell indicating a volatile trend in short term. One should be stock specific & follow the trend with trail stop loss levels till it reverses. Close or sustain below short term reversal levels will lead to correction till 10500/10300 levels on nifty in short term.

Stock Picks: 

CUMMINS – BUY

CLOSE – Rs 830

TARGET – Rs 870-900

CUMMINS closed weekly in negative territory. It’s outperforming in short term. It managed to hold crucial support of 40 DMA. Its weekly momentum indicators are in BUY. One can buy with a stop loss of Rs 810 for the target of 870/900 levels in short term.

GRANULES INDIA – BUY

CLOSE – Rs 94.10

TARGET – Rs 105

GRANULES closed weekly in positive territory. It’s outperforming in short term. It managed to hold 20DMA. Risk reward is favorable to buy at current levels. Its daily momentum indicators are in BUY. One can buy with a stop loss of Rs 85 for the target of 105 levels in short term.

IOC – BUY

CLOSE – Rs 137.20

TARGET – Rs 142/148

IOC closed the weekly in positive territory. It’s outperforming in short term. Risk reward is favorable to buy at current levels. Its daily momentum indicators are in BUY. It’s trading above 20DMA. One can buy with a stop loss of Rs 129 levels for the target of 142/148 levels in 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 scripts mentioned above.