NIFTY ANALYSIS AND WEEKLY PICKS
NIFTY ON 06-01-2023
Opened flat, NIFTY failed to sustain the immediate resistance of 18040 and selling pressure was observed in all indices.
BANK and IT remained the biggest losers with losses of 0.99% and 2.0%.
The weak global cues, fear of recession and selling from FIIs were the prime reasons behind the unidirectional fall.
Index fell to retest 17800 during Intraday which is strong support level of NIFTY for short as well as medium term.
Index finally closed above 17850 with a loss of 0.74% making a long bearish candle on daily chart.
Technical View: Daily Chart
NIFTY has made a Bearish candle with Lower Highs Lower Lows candle formation which may be taken as an indication of further downside.
NIFTY is moving below EMA 13, 21, 34 and EMA 13< EMA21<EMA34 which confirms the down trend of Index.
RSI below 40 level confirms that Index has come out of consolidation zone and a break down has occurred.
Support and Resistance : Daily Chart
17840-775 will work as the first support level for NIFTY and below this 17729 will hold strong support.
On the upper side NIFTY will face resistance in the range of 17915-986. Above this 18040 will hold strong resistance.
Sectoral View: Weekly Charts
BANK and OIL&GAS look strong on chart and investors should look for opportunities to buy on Dips.
AUTO, FMCG and PHARMA are signaling of positive reversal from current reversal while METAL and PSU BANK are signaling negative reversal from current levels.
IT looks weak and the traders should adopt the strategy of Sell on Rise in this sector.
View for Traders:
Index is weak as all the technical indicators are signaling in this direction as discussed above.
An analysis of Options Chain also gives us the clear view that traders are bearish on Index as the highest OI of 11960850 is on Call side is at 18000 against which OI of 5485950 lies at 18000 on Put Side. Hence, 18000 will be the crucial level to watch.
However, there are two factors which may give some relief to the bulls:
I. Dow Jones jumped 2,13% during the Trading session in USA on Friday
II. Index has given a rally from 17800 level during the recent fall
So, the cues are mixed and it indicates that Monday i.e., 09.01.2023 is going to be a volatile session with trades taking place at both ends.
As it seems that trades will take place at both the ends the traders must be ready for the volatility.
Buy NIFTY in the range of 17900-925 for target of 18000-18025. SL may be kept below 17800 on closing basis.
Sell NIFTY in the range of 18000-18040 for target of 17925-900. SL may be kept above 18100 on closing basis.
WEEKLY PICKS
1. HPCL
Buy in the range of 240-245
Target 263
SL 230.
Potential Upside 9.58%
2. IOC
Buy in the range of 80-81
Target 86
SL : 78
Potential Upside: 7.5%
3. SONACOMS
Buy in the range of 411-415
Target 455
SL 400
Potential Upside 10.70%
4. ASTRAL LTD
Buy in the range of 2030-2050
Target 2160
SL 1995
Potential Upside 6.40%
5. CUMMINS INDIA
Buy in the range of 1415-1420
Target 1502
SL 1390
Potential upside 6.14%
Opened flat, NIFTY failed to sustain the immediate resistance of 18040 and selling pressure was observed in all indices.
BANK and IT remained the biggest losers with losses of 0.99% and 2.0%.
The weak global cues, fear of recession and selling from FIIs were the prime reasons behind the unidirectional fall.
Index fell to retest 17800 during Intraday which is strong support level of NIFTY for short as well as medium term.
Index finally closed above 17850 with a loss of 0.74% making a long bearish candle on daily chart.
Technical View: Daily Chart
NIFTY has made a Bearish candle with Lower Highs Lower Lows candle formation which may be taken as an indication of further downside.
NIFTY is moving below EMA 13, 21, 34 and EMA 13< EMA21<EMA34 which confirms the down trend of Index.
RSI below 40 level confirms that Index has come out of consolidation zone and a break down has occurred.
Support and Resistance : Daily Chart
17840-775 will work as the first support level for NIFTY and below this 17729 will hold strong support.
On the upper side NIFTY will face resistance in the range of 17915-986. Above this 18040 will hold strong resistance.
Sectoral View: Weekly Charts
BANK and OIL&GAS look strong on chart and investors should look for opportunities to buy on Dips.
AUTO, FMCG and PHARMA are signaling of positive reversal from current reversal while METAL and PSU BANK are signaling negative reversal from current levels.
IT looks weak and the traders should adopt the strategy of Sell on Rise in this sector.
View for Traders:
Index is weak as all the technical indicators are signaling in this direction as discussed above.
An analysis of Options Chain also gives us the clear view that traders are bearish on Index as the highest OI of 11960850 is on Call side is at 18000 against which OI of 5485950 lies at 18000 on Put Side. Hence, 18000 will be the crucial level to watch.
However, there are two factors which may give some relief to the bulls:
I. Dow Jones jumped 2,13% during the Trading session in USA on Friday
II. Index has given a rally from 17800 level during the recent fall
So, the cues are mixed and it indicates that Monday i.e., 09.01.2023 is going to be a volatile session with trades taking place at both ends.
As it seems that trades will take place at both the ends the traders must be ready for the volatility.
Buy NIFTY in the range of 17900-925 for target of 18000-18025. SL may be kept below 17800 on closing basis.
Sell NIFTY in the range of 18000-18040 for target of 17925-900. SL may be kept above 18100 on closing basis.
WEEKLY PICKS
1. HPCL
Buy in the range of 240-245
Target 263
SL 230.
Potential Upside 9.58%
2. IOC
Buy in the range of 80-81
Target 86
SL : 78
Potential Upside: 7.5%
3. SONACOMS
Buy in the range of 411-415
Target 455
SL 400
Potential Upside 10.70%
4. ASTRAL LTD
Buy in the range of 2030-2050
Target 2160
SL 1995
Potential Upside 6.40%
5. CUMMINS INDIA
Buy in the range of 1415-1420
Target 1502
SL 1390
Potential upside 6.14%
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