Nifty outlook and top trading ideas by Devang Shah for today

NIFTY      

CLOSE- 11278.90 (11.05. 2019)

Market, last week, ended in the negative territory for the third week in a row. Nifty has broken crucial support of 11,550 levels and witnessed sharp fall during the week. We have seen selling pressure across-the-board. It still looks like profit booking ahead of election results this month.  Any kind of decline or consolidation is buying opportunity in individual stocks till short term reverses. 

Short-term outlook for the market remains positive till Nifty trades above 10,940 levels and we expect targets in the range of 12,300-12,500 levels in the short term. Medium-term outlook for the market remains positive till Nifty trades above 9,951 levels with the targets seen in the range of 12,800-13,200 levels in medium term.

Midcap and small-cap indices closed the week in the negative territory. It is still underperforming the frontline indices (Nifty/Sensex and Bank Nifty) in short term. It has to catch up now for further confirmation of overall trend of the market. 

One should closely watch out broader market behavior in coming weeks. It still looks like high possibility end of this divergence at recent bottom and from now onwards, we will get broader market rally for higher level targets in short-to- medium term. Risk reward is favorable to buy specific stocks at current levels of market.

Bank Nifty also ended the week in negative territory for the third consecutive week. It has also broken strong support of 29,400 levels of short term. 27,000 level is strong support on the index.  As long as it holds the level, one can expect higher level targets till 32,500 levels in short term. Any kind of decline or consolidation is buying opportunity till short term reverses. 23,600 level is the strong support for medium term perspectives.  Till it holds that, one can expect higher level targets in the range of 34,000 on medium-term perspective.

11,000 and 12,000 are strong support and resistance levels, respectively based on option open interest (OI) data for current month series. Any kind of such short term correction or consolidation is stock-specific buying opportunity for medium- to-long term investment perspective, till medium term reverses. Market to remain volatile till election results. 

Momentum indicators Daily KST and Daily MACD both are in sell, indicating volatility for short term. One should be stock-specific and follow the trend with trail stop loss levels till it reverses. Risk reward is favorable to buy at current levels of market. A close below short term reversal levels will lead to sharp correction till 10,500/10,300 levels on Nifty in short term.

Stock Picks:
 

BEL: BUY
 

CLOSE: Rs 89.50
 

TARGET: Rs 96/98

BEL closed the week in positive territory. It looks like end of short term correction. Its weekly momentum indicators are in BUY. Risk reward is favorable to BUY at current levels. One can buy with a stop loss of Rs 85.40 for the target of 96/98 levels in short term.

TATA CHEM – BUY
 

CLOSE – Rs 588
 

TARGET – Rs 620/640

Tata Chemicals settled the week in positive territory. It looks like end of short-term correction. Its weekly momentum indicators are in BUY. Risk reward is favorable to Buy at current levels. One can buy with a stop loss of Rs 554 for the target of Rs 620/640 levels in short term.

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

Disclaimer: The analyst may have a position in the scrip mentioned above; the views given above are the personal views of the analyst.