 "Nifty may touch 8,650 in medium term; buy Ambuja Cement, RIL: Sharekhan")
NIFTY
CLOSE- 7,850.45 (13.04.16)
Market closed weekly in positive territory after consecutive decline of last two weeks. It sharply reversed from lower levels & confirmed short term reversal at the end of weekly trading session. All the other indices such as Midcap, Smallcap & Bankex etc also closed weekly in positive territory.
It made a low of around 7,516 levels in recent correction & retraced only 23.6% of preceding rise from bottom which is lesser than anticipated. And it closed above the high/resistance levels of around 7,778 levels at the end of weekly trading session & confirmed trend reversal.
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Short term out look for the market remains positive till Nifty50 trades above 7,663 levels & expecting target of 7,980 levels in short term & further above 8,335-8,650 levels in medium term. One should use any kind of decline or consolidation to buy stock specific for higher levels targets in short to medium term.
It looks like beginning of wave-III or wave-C up from wave count perspectives till short term reveres. Market started to rally from 40 DMA i.e. typically strong support levels in bull market. Continuation of up trend in coming trading session will further confirm about validity of this pattern.
8,000 levels on Nifty50 looks strong resistance levels in short term based on derivative open interest data. Momentum indicators daily KST & DAILY MACD both are in BUY supporting short term trend. Close below short term reversal levels will lead to sharp fall till 7,500-7,400 levels on Nifty50 in short term. One should be stock specific & follow the trend with trail stop loss levels till it reverses.
Stock Picks:
AMBUJA CEMENT: BUY
CLOSE: Rs 231.30
TARGET: Rs 237/Rs 242
AMBUJA CEMENT closed weekly in positive territory. It’s out performing in short term. It started wave-V up on daily chart after short term consolidation. Risk reward is favourable to BUY at current levels. One can BUY with a stoploss of Rs 225 for the target of Rs 237/Rs 242 in short term.
RIL: BUY
Close: Rs 1,065
Target: Rs 1,100/Rs 1,145
RIL closed weekly in positive territory. It’s out performing in short term. Its momentum indicators are in BUY. It started wave-V up on daily chart after short term consolidation. Risk reward is favourable to BUY at current levels. One can BUY with a stoploss of Rs 1,046 for the target of Rs 1,100/Rs 1,145 in short term.
The author is Portfolio Manager- PRO TECH-PMS at Sharekhan
Disclaimer: The analyst may have a position in the scrip mentioned above; the views given above are the personal views of the analyst.
