Nifty could face resistance at 11,000 level: Gaurav Garg of CapitalVia

Market traded with positive sentiment on last Friday, July 17 and added short covering move in Nifty Bank in the last hour of trade. However, psychological mark of 11,000 might act as hurdle this week as it carries highest call OI in both weekly and monthly contract of July. Nifty managed to close at 10,901.70 adding 161.70 points. PSU banks, Financial servicesand Auto stocks closed with positive note, whereas technology stocks closed in red mark. Nifty bank closed at 21,966.80 adding 345.51 points.
 

As per weekly option data, handful of put writing on lower strikes ranging from 10,700 to 10,800 is seen which shows Nifty might take support in sub-zone of 10,800. 11,000 might also act as resistance as maximum call OI is placed here after 11,200. But Nifty is likely to take support at 10,700 as maximum put OI is placed here.We might witness weakness only if Nifty breaks level of 10,700. Therefore, traders should try to create long position keeping close eye on 10,700, as it might act as crucial support for weekly expiry.
 

We can see a big momentum in following stocks: 
 

Buy ICICI Bank Limited (Above Rs 357)
 

Target: Rs 381
 

Stop loss: Rs 340
 

The stock has taken support from its key moving average, which is placed at 340, breaking level of 357 might add more thrust. Further, the stock is witnessing resistance breakout above 357 that might lead it to witness more upward movement. Considering the technical evidence discussed above, we recommend buying the stock above Rs 357 for the target of Rs 381, and keeping a stop loss at Rs 340 on closing basis.
 

Buy Bajaj Finance Limited (Above Rs 3,325)
 

Target: Rs 3,528
 

Stop loss: Rs 3,204
 

The stock took support from its important moving average and forming bullish flag pattern. Further, it might give resistance breakout from level of 3,325 might lead stock to witness more upward movement. We recommend buying the stock above Rs 3,325 for the target of Rs 3,528, and keeping a stop loss at Rs 3,204 on closing basis.

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Disclaimer: Gaurav Garg is Head of Research at CapitalVia Global Research Limited- Investment Advisor. The analyst does not hold position in any of the stocks mentioned above. Views expressed are personal.