Midcap & Small-cap indices to hit all-time high levels soon: Devang Shah

The short-term outlook for the market remains positive till Nifty trades above 10,929 levels, says Devang Shah

NIFTY      

CLOSE- 11360.80 (03.08.2018)

The market closed the 2nd consecutive week in positive territory. It has extended on the upside as expected last week. It made a high of 11,390.55 levels on Nifty & 37,711.87 levels on Sensex so far in the rally during this week. One can expect the market to trend towards further higher levels targets as mentioned below in short to medium term. Any kind of short-term consolidation or correction is stock specific buying opportunity till short-term reverses.

Midcap & Small cap indices also closed weekly in positive territory. We have seen outperformance in broader market during the week. It will catch up with main indices with faster face & relatively outperform in the coming months of the calendar year 2018. One should still find out an opportunity to buy quality beaten down stocks of midcap & small cap index from medium to long-term perspectives.

The short-term outlook for the market remains positive till Nifty trades above 10,929 levels and expecting targets in the range of 11,500- 11,600 levels in short term. Medium term outlook for the market remains positive till Nifty trades above 8,968 levels and expecting targets in the range of 12,000-12,200 levels in the medium term.

Nifty Bank closed weekly in positive territory. It has also extended rally on the upside as expected last week. It made a high of 27,872.10 levels so far in this rally & made fresh all-time high during this week. 26,000 levels is strong support for Nifty Bank for short-term, till it holds one can expect higher levels targets till 28,400 levels in short-term & further above 29,800-30,000 levels in the medium term. Any kind of decline is also buying opportunity for Nifty Bank for short to medium term perspectives.

11,000 & 11,500 levels is strong support & resistance levels respectively based on option open interest data for current month series expiry perspectives. As expected market has made new lifetime high on Nifty & Sensex so far & by looking at current structure, I feel market is going to surpass all-time high soon on rest of the other indices such as BSE 500, Midcap & Small cap indices as well in coming months & this rally will have time wise consolidation rather than price wise correction in short term. Any kind of such short-term correction or consolidation is buying opportunity for medium to long-term Investment perspectives till medium term reverses.

Momentum indicators Daily KST & DAILY MACD both are in BUY supporting the short-term trend. One should be stock specific & follow the trend with trail stop loss levels till it reverses. Close below short-term reversal levels will lead to sharp correction till 10,500-10,400 levels on Nifty & 34,900-34,300 levels on Sensex in short term.

Stock Picks: 

L&T FIN- BUY

CLOSE – Rs 181

TARGET – Rs- 192-200

L&T FIN closed the weekly in positive territory. It has wave-V up pending as per daily chart. Its daily momentum indicators are in BUY. Risk reward is favorable to BUY at current levels. One can BUY with a stop loss of Rs-164 for the target of Rs 192-200 levels in short-term. 

CUMMINS INDIA - BUY

CLOSE – Rs 717

TARGET – Rs 750-780

CUMMINS closed the weekly in positive territory. It looks like the end of medium-term correction. Its mometum indicatros are in BUY. One can BUY with a stop loss of Rs-670 for the target of Rs-750-780 levels in short-term. 

AXIS BANK - BUY

CLOSE – Rs 574

TARGET – Rs 600-620

AXIS BANK closed the weekly in positive territory. It managed to hold the crucial support of 20 DMA. Risk Reward is favourable to BUY at current levels. Its daily momentum indicators are in BUY. One can BUY with a stop loss of Rs-550 for the target of Rs-600-620 levels in short-term. 

VOLTAS - BUY

CLOSE – Rs 574

TARGET – Rs 610-630

VOLTAS closed the weekly in positive territory. It consolidated during the week. It closed above 20 DMA. Risk Reward is favourable to BUY at current levels. One can BUY with a stop loss of Rs-550 for the target of Rs-610-630 levels in short-term.

GODREJ INDUSTRIES - BUY

CLOSE – Rs 625

TARGET – Rs 655-675

GODREJ closed the weekly in negative territory. Its daily momentum indicators are in BUY. Risk Reward is favourable to BUY at current levels. Its daily momentum indicators are in BUY. One can BUY with a stop loss of Rs-600 for the target of Rs-655-675 levels in short-term.

Devang Shah: The author of www.trendtechno.com (Trade with Trend) and an independent market analyst.

Disclaimer: The analyst may / may not have a position in the scrips mentioned above