Short-term outlook for the market remains positive: Devang Shah

Medium term outlook for the market remains positive till Nifty trades above 8,968 levels, says Devang Shah

NIFTY     
CLOSE- 10618.25 (04.05.2018)
 
The Market closed first weekly negative close after five-consecutive week of positive rally from bottom. It slow but steady extending on upside towards short term targets levels range as expected last week. It made a high of 10784.65 levels on Nifty & 35,357.15 levels on Sensex so far. It looks like wave-(I) of 5 completion with weekly negative close & one can expect wave-II correction or consolidation before wave-(III) of 5 begins. It looks time wise consolidation rather price wise correction in this wave-II phase of Market as per my preferred view. Any kind of decline or short-term consolidation is stock specific buying opportunity till short term reverses & One can expect higher levels targets as mentioned below in short to medium term.

Bank Nifty also closed 2nd consecutive week in positive territory. It has outperformed during this week as well. It made a high of 25,753.70 levels so far in this rally. It can be also possible to count end of Wave-I of (5) impulsive rally from recent bottom from wave count perspectives. One can expect higher levels targets around 26600 levels till it holds crucial support of 24700 levels in short term & further above 29600-30000 levels in medium term. Any kind of decline is also buying opportunity for bank nifty for short to medium term perspectives.

 
Short-term outlook for the market remains positive till Nifty trades above 10279 levels and expecting targets in the range of 10900-11000 levels in short term. Medium term outlook for the market remains positive till Nifty trades above 8,968 levels and expecting targets in the range of 12000-12200 levels in medium term.

 
 
10500 & 11000 levels is strong support & resistance levels range respectively based on option open interest data so far for current month series. Market will remain very volatile ahead of Result season this month. By looking at current structure, I feel market is going to surpass all time high soon on main indices & this rally will have time wise consolidation rather than price wise correction in short term. Any kind of such short-term correction or consolidation is buying opportunity for medium to long term Investment perspectives till medium term reverses.

Momentum indicators Daily KST went in to SELL but daily MACD is still in BUY supporting short term trend. Market will remain volatile ahead of state election results this month. One should be stock specific & follow the trend with trail stop loss levels till it reverses. Close below short- term reversal levels will lead to sharp correction till 9950-9800 levels on nifty & 32400-31800 levels on Sensex in short term.

 
 
Stock Picks:
 
L&T FIN: BUY

CLOSE: Rs 177

TARGET: Rs 185/190
 
L&T FIN closed weekly in positive territory. It’s outperforming in short term. It has broken out of short term consolidation. Its daily momentum indicators are in BUY. One can BUY with stop loss of 168 for the target of 185/190 levels in short term.
 
FED BANK: BUY

CLOSE: Rs- 100.60

TARGET: Rs 106/109
 
FED BANK closed weekly in positive territory. It’s outperforming in short term. It has broken out of short term consolidation. Its daily momentum indicators care BUY. Risk reward is favourable to BUY at current levels. One can BUY with a stop loss of Rs 95 for the target of Rs 106/109 in short-term.

 
POWER GRID: BUY

CLOSE: Rs 207.35

TARGET: Rs 211-212
 
POWER GRID closed the weekly in positive territory. Its outperforming in short term. 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 202 for the target of Rs 211-212 levels in short-term.
 
BAJAJ FIN: BUY

CLOSE: Rs- 1864

TARGET: Rs 2050/2100
 
BAJAJ FIN closed the weekly in negative territory. It’s looks like wave-IV Consolidation as per daily chart & It has wave-V Up pending as per weekly chart. Its weekly momentum indicators care BUY. Risk reward is favourable to BUY at current levels. One can BUY with a stop loss of Rs-1770 for the target of Rs 2050/2100 levels in short-term.

 
OFSS: BUY

CLOSE: Rs-4160

TARGET: Rs-4400/4450
 
OFSS closed the weekly in negative territory.  It’s looks like wave-IV Consolidation as per daily chart & It has wave-V Up pending as per daily chart. 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 4050 for the target of Rs 4400/4450 levels in short-term.
 
Disclaimer: The analyst may / may not have a position in the scrips mentioned above