Investors need to be cautious in the Near Term amid the ongoing decline in the stock market. Sudeep Shah, the head of Vice President and Technical and Derivative Research Desk in SBI Securities, says that every attempt to boom in the case of Nifty 50 is facing strong selling pressure. Selling may emerge at high levels. The selling pressure continues in the bank Nifty. What else did Shah give and what are his top stock ideas in the new starting week, let’s know …
Given the pressure at high levels, do you think the Nifty 50 will fall below the 50-Veek EMA 24000 level in the coming week?
The benchmark Nifty index declined the sixth consecutive week. This is the longest period of weekly decline since the market declines during Covid-19 in 2020. Constant weakness shows the notion of recession in the market. The fourth consecutive week, the index has created a bearish candle with a long upper shadow. This is an indication that there is a strong pressure of selling every effort to fast. This reflects the lack of trust between bulls and the dominance of bears at high levels.
The Nifty 50 is now trading below its 20-Day, 50-Day and 100-Day EMA (exponical moving average). In addition to the negative outlook, the RSI i.e. the RSI i.e. the Relative Strength Index has entered a super bearish zone. Overall, the technical status presents a picture of vigilance for the new term, in which the rally may face resistance and can emerge selling at high levels.
Talking about important levels, the zone of 24200-24150 will work as important support for Nifty 50. If the index slips below the level of 24150, it is expected to reach a level of 23750. The upward 100-day EMA zone of 24570-24600 will serve as a significant obstacle for the index.
Do you think the bank Nifty will get support near the last swing high of 54500, or it can go to the low of May due to decline?
Banking benchmark index bank Nifty also ended the week with negative note. This reflects frequent weakness in the financial sector. It has created a bearish candle on the weekly chart, indicating frequent selling pressure. For the last two sessions, the index is hovering around its 100-day EMA.
The 100-day EMA zone of 54950-54850 will be an important support area. The index may further increase the decline from 54850. The next support zone at the bottom is at 54000-53900. Any recovery at the top may face resistance around 55700-55800. It is now working as a major obstacle for bulls.
What are your favorite two stocks for next week in this bearish market?
Kajaria Ceramics: In the last few trading sessions, this stock has been continuously performing better than frontline indexage. On Friday, it recorded a breakout above a horizontal trendline on the daily chart, supporting strong volume. This confirms the sharp boom in the stock. Technically, this stock is trading above all major moving averages, and Momentum Indicators are positively align. They strengthen the trend of fast. In view of this situation, we recommend buying this stock with a stop-loss of Rs 1250 within a radi of Rs 1310-1300. At the top, this stock has the capacity to reach Rs 1410 in the Near Term.
Affle 3i: This stock has recently got support with its 100-day EMA and since then it has registered upwards. This stock has also performed better than major indexage. Currently it is getting consolidated in a limited range and creating a solid base around its 20-day EMA. It is a sign of strength and stability. Stock is trading above the major moving average, and technical indicators are continuously pointing to a boom. In view of this situation, we recommend buying this stock with a stop-loss of Rs 1880 within a radius of Rs 1970-1950. On the top, this stock has a capacity to reach Rs 2150 in the short term.
Do you expect the bullish trend to continue in Cummins India and Global Health?
Yes, both Cummins India and Global Health are showing a bullish trend even amidst the weakness of the market. Their Weekly Charts reflect a clearly defined upward transctory, which is supported by good volumes. This indicates constant interest in purchasing. Technically, both shares are trading above the major moving averages and the Momentum Indicator, positively align, which strengthens the ongoing uptrend. This shows that until the widespread market situation does not fall a major decline, these shares are likely to continue the bullish momentum.