Mr. Debabrata Bhattacharjee, Head of Research, CapitalAim
The benchmark index, which had been stuck in a consolidation trading range for the past 15 weeks, has finally seen a price breakout to hit a new high of 2019, suggesting that benchmark is set to climb. Bank Nifty Index also surge and hit an all-time high on a breakout of past 9 weeks. Major gains come from Bank Nifty in the Index, banking stocks pull the sentiment to higher. Heavyweights HDFC Bank, ICICI Bank, Kotak Bank, and Axis Bank are the puller of this northward rally. As the Credit demand grows and asset quality improves, banks are expected to lead the journey for the broader indices. Insolvency and Bankruptcy Code Improves the credit growth, the government's mega recapitalization of PSU banks turns the scenario of banking in India from negativity to positive.
On Fridays, Benchmark Nifty surge almost 83.60 points or 0.74% at 11426. Nifty50 hit a new high of 2019 on Friday's trading and near about its all-time high of 11700. A cautious approach is the best strategy to trade in Index at this juncture. We would advise investors to take breathe and have to watch further action in Index or sustainability of Nifty50 because of it's trading at around all-time high. There is a range of 11200-11450 where once we can wait for further action. The RSI indicator which is a gauge of 14-day continued to be in the overbought zone, keeping in this mind one could be cautious.
We also look for Current Account no. which is expected to release on Monday. On the International Front one can keep an eye on Fed's Interest rate decision on Wednesday along with Current account. Overhang on Brexit issues and OPEC's supply cut are likely to hit the domestic market in specific segment. Therefore, we advise to continue maintain a strict trailing stop loss on long position, and book profit at higher level on weakness. However market is looking positive ahead of the 2019 general elections.
Stock Future recommendations :
JUBLIANT: BUY| Above : Rs 1360| Target: Rs 1450| Stop loss: Rs 1310|
Jubliant food works is forming a triangle type pattern on weekly charts and hence breakout from that. This will leak towards 1450+ level in near future. 1425 is the immediate target in Jubilant in a shorter time frame.
INFIBEAN : BUY| Above : Rs 46.60| Target: Rs 49| Stop loss: Rs 44.30|
INFIBEAN is backed by e-comm. Segment is majorly focused sector in today's economy. Infibean is consolidating at the bottom from past 17 weeks. One can keep an eye on this particular stock.
TATAMTRDVR: SELL| Below : Rs 88.00| Target: Rs 85.50| Stop loss: Rs 91.00|
Tata motor's Balance-sheet also hit this stock in the past week. RSI of 14 day's is well below it's oversold zone it rally to downward continue