A break above 23,500 may clear Nifty’s path to 24,000

SUDEEP SHAH HEAD - TECHNICAL & DERIVATIVE RESEARCH DESK, SBI SECURITIES

Where is the Nifty headed this week?

Market’s focus would now shift to monsoon and the Union Budget. India VIX has cooled off 60% from the highs of 29-30 levels to the 13 zone, implying smooth sailing for the markets in the near term. Chart patterns suggest 23,200-23,250 will act as a crucial support and a possibility of consolidation in 23,200- 23,500 zone looks more likely.

Above 23,500, a fresh move up to 23,800-24,000 would be witnessed. Weekly options data coupled with India VIX sustaining at higher levels suggests possible consolidation within the 23,200-23,800 range this week.

What should investors do?
Stock-specific action could continue in quality mid-caps and small-caps. We expect large-cap names from select private as well as power, capital goods, realty, defence, CPSE, as well as auto to outperform going ahead. Positive trade set-up is visible in select large-cap names such as M&M, TVS Motors, Bharti Airtel, Grasim, and UltraTech Cement. On the mid-cap front, stocks like L&T Finance, Indian Hotels, Concor, Engineers India, ICICI Lombard, BDL and Mazagon Dock could continue to witness strong buying interest.

ARPAN SHAH SENIOR RESEARCH ANALYST, MONARCH NETWORTH CAPITAL

Where is the Nifty headed this week?

Nifty traded volatile in the first week of the series and made a hanging man candlestick formation on the weekly chart. On the derivative front, FIIs have covered their short positions and their net long positions have reached 47% from 12.8%, at the beginning of the series. India VIX has also corrected from elevated levels and fell below 13 post the election result, which indicates subdued momentum in coming days. Nifty is likely to consolidate for the next few days in 23,200-23,600 range, and breakout from this range will have a trending move in that direction.

What should investors do?

Among banking stocks, HDFC Bank is likely to outperform others and any dip in the stock should be used as a buying opportunity.

The Nifty Pharma index has given a fresh breakout on the weekly chart and is likely to provide a 10-15% upside from the current level.
Pharmabees (Pharma index ETF) is the safest bet to participate in this upside.

Cipla and JB Chemicals are top picks from the sector. Insurance sector stocks have underperformed the broader market in the last two years, but they are showing signs of reversal for the last few days. LIC and HDFC Life can be added at the current level. Midand small-cap investors can look to accumulate Sula Vineyards, Fine Organics
and TCPL Packaging at current levels.

MEHUL KOTHARI AVP - TECHNICAL RESEARCH, ANAND RATHI SHARES & STOCK BROKERS

Where is the Nifty headed this week?

For Nifty, 23,000 is considered a crucial support level. On the other hand,

23,500 is identified as a significant resistance, where selling pressure is anticipated to be strong enough to cap any upward movement.

If Nifty falls back inside the ascending channel, investors might take this as an opportunity to book profits up to 23,000 level, leveraging the expected support at this point. Conversely, if the index manages to close decisively above the 23,500-resistance level, it could signal further bullish momentum, potentially driving the index to 24,000 by the end of the next week. This scenario indicates a positive market sentiment and suggests that breaking above 23,500 would likely trigger additional buying interest, pushing the index higher. Hence, traders are advised to buy quality stocks on any significant dips

What should investors do?

On the sectoral front, defensive like pharma, FMCG, and IT would be on the radar. One can look to invest in Pharmabees, and also ITBEES can be bought. On the stocks front, we like Hindustan Zinc for the coming months since we expect a fresh round of rally in silver. In addition, GMR Infra looks good for an upside target of `100–110, and the overall support seems to be around `85 for the stock.