By Shrikant Chouhan
The benchmark indices continued the range-bound activity on Tuesday. The Nifty closed at 18,599 points higher while the Sensex ended at 62,792 points. Among Sectors, Auto and Reality indices gained over 1 percent whereas the IT index corrected sharply, shedding over 1.7 percent. Technically, from the day’s lowest points the market bounced back sharply. In addition, the market is consistently holding higher bottom formation. For the traders now, 18550/62550 would be the trend decider level for Nifty50/Sensex. As long as the indices are trading above the same the uptrend formation is likely to continue. Above the same, the market could move up to 18700-18750/63000-63300. On the flip side, below 18550/62550 uptrends would be vulnerable. Below the same, the market could retest the level of 18480/62500. Further downside may also continue which could drag the index till 18440/62400.
HDFCLIFE: BUY – CMP: Rs 582.6 – TARGET: Rs 610 – SL: Rs 570
After hitting the recent highs of around 600, the stock witnessed a selloff and dropped on the lower side. However, it has found support near the important retracement zone. As a result, the bullish trend is very likely to continue for further up move in the near term.
INDIGO: BUY – CMP: Rs 2408 – TARGET: Rs 2530 – SL: Rs 2350
The counter is trading in a rising channel constantly on a weekly scale. The higher high and higher low chart formations are apparent in the counter. Additionally, trend indicators such as MACD and ADX are showing bullish strength. Therefore, upward movement from the current level is very likely to remain in the near future.
CUMMINSIND: BUY – CMP: Rs 1813 – TARGET: Rs 1900 – SL: Rs 1775
The stock is trading into a rising channel pattern after reversal from the lower levels and forming the higher lows series continuously. The strong bullish candlestick pattern on the daily chart suggests that the counter is likely to maintain a bullish continuation formation in the coming horizon.
(Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities Limited. Views expressed are author’s own.)