Tech View: Nifty may consolidate in 24,200-24,800 range

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

Where is the Nifty headed?

FIIs’ long-short ratio in index futures peaked at 81% during the week and is now around 79%, which might be a negative indicator for the markets moving forward. In addition, we are witnessing a bearish engulfing pattern on the daily scale of Nifty. This indicates that the top of 24,850 would be difficult to conquer. On the other hand, the markets appear resilient, potentially buoyed by expectations for the upcoming budget. This suggests that there is some indecisiveness at current levels. Traders are advised to stay stock-specific and maintain strict stop-loss strategies. A breach of 24,500 could halt the current momentum and we might witness further profit booking during Monday’s session towards 24,300 – 24,200.What should investors do?

The way markets and indi vidual stocks have rallied; it seems the best strategy here could be to wait and watch. Traders should avoid aggressive bets in the coming week whereas investors can hold on to their longs as the long-term outlook continues to remain bullish. Many stocks are on the corrective note but look lucrative once they correct, like NBCC, NLC India, NHPC, BEML, IRB, and Railtel. The given list of stocks can be added once we witness a considerable correction in the markets.SUDEEP SHAH, HEAD TECHNICAL AND DERIVATIVE RESEARCH, SBI SECURITIES

Where is the Nifty headed? Recent sessions have seen increased volatility and profit booking from higher levels, particularly in the midcap and smallcaps. This comes ahead of the Budget on Tuesday. Over the past couple of weeks, sector rotation has helped the market sustain higher levels. However, despite strong performances in the IT and FMCG, the market witnessed profit booking on Friday. Nifty has formed a Bearish Engulfing pattern on daily chart and a Shooting Star on weekly chart. These suggest investors should adopt a cautious stance ahead of the budget. The next course of action is likely to be decided by the Budget, the progress of the Monsoon, and the earnings season of Q1FY25.

What should investors do?

Chart patterns suggest that the 20-day EMA zone of 24,200-24,250 will act as a crucial support going forward and a possibility of consolidation between 24,200 and 24,800 zone looks more likely based on the option data. Above 24,800, a fresh move up to 25,200-25,400 would be witnessed. In case 24,200 is breached, correction up to 23,800 cannot be ruled out.

JATIN GEDIA, TECHNICAL RESEARCH ANALYST, SHAREKHAN

Where is the Nifty headed? Nifty is likely to undergo mean reversion and, in the process, can test the levels of 24,200 (20-DMA) and 24,000 (23.6% Fibonacci retracement level of the rally from 21,281 – 24,854). Considering the Budget announcement during the week, volatility is likely to be high and one shouldkeep crucial support levels handy. In case of a deeper correction, Nifty can test levels of 23,490 (38.2% Fibonacci retracement level of the rally from 21,281 – 24,854). On the upside, a breakout above 24,900 shall lead to a rally towards 25,530.

What should investors do?

Investors should consider booking profits in mid-cap and small-cap stocks where they have a decent return on their investments. Sell Adani Ports with a stop loss of ₹1,510 for the target of ₹1,391 – 1,337. Sell Chambal Fertiliser with a top loss of ₹505 for the target of ₹473 – 465. Sell Hindalco with a stop loss of ₹678 for the target of ₹635 – 624. Buy SBI Life with a stop loss of ₹1,593 for a target of ₹1,695 – 1,725. Buy Titan with a stop loss of ₹3,120 for a target of ₹3,360 – 3,480.