By Shrikant Chouhan
The benchmark indices BSE Sensex and Nifty 50 witnessed a short recovery on Tuesday. Technically, after the morning selloff the market witnessed a sharp intraday recovery from the level of 17050/57050. On daily charts, the index has formed Hammer formation which suggests indecisiveness between bulls and bears. We are of the view that the short-term trend is still on the weak side but due to a temporary oversold situation, the market may consolidate. For the trades, a large trading range would be 17100/57200 to 17400/58300. For the day traders, 17150/57350 would be the important support level, above which the index could move up to 17350-17400/58150-58300. On the other side, below 17150/57350 the chances of hitting 17100-17075/5720057100 would turn bright.
Post short term correction, the stock is available near its support zone of 1700-1690, which could act as a strong base. Simultaneously, making it a favorable candidate in terms of risk and reward. Therefore, the current setup is signaling for a bullish up move in the near term.
Bajaj FinanceBUY, CMP: Rs 7,055, TARGET: Rs 7,400, SL: Rs 6,900
After hitting the all-time high of 8050 the counter has witnessed a range-bound activity for a few sessions. And currently, it is available near the lower boundary of the range. Hence the structure indicates a reversal of the trend for further upward movement.
Dr.Reddy’s LaboratoriesBUY, CMP: Rs 4,321.95, TARGET: Rs 4,540, SL: Rs 4,230
Post sharp correction from the highs of around 5000 its downtrend took a pause near its support zone. From last week the stock is seen into an accumulation phase with incremental volume activity. The current texture of the charts suggests a fresh leg of uptrend is likely in coming trading sessions.
IndusInd BankBUY, CMP: Rs 937.7, TARGET: Rs 985, SL: Rs 915
On the daily time frame, after the sharp up move, the stock witnessed gradual price decline. However, reversal is seen from its important retracement support zone on the intraday charts. The formation indicates the stock is very likely to resume its new leg of the uptrend from the current levels.
(Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities, Views expressed are the author’s own.)