Short-term outlook for market remains positive; Buy Cummins, IOC, Sun TV

Short-term outlook for the market remains positive till Nifty trades above 10333 levels and expecting targets in the range of 11170-11450 levels in short-term, says Devang Shah.

NIFTY

CLOSE - 10,859.90 (28.12.2018)

The market closed weekly in positive territory. It managed to hold lower end support levels & sharply recovered from these levels. It made a low of 10534.55 levels & 35010.82 levels on Sensex during the week. Its once again closed near the upper end of the range at the end of weekly trading session. One should watch out market behavior near this crucial levels. Able to break this range on the upside will finally confirm the trend towards higher levels targets as mentioned below in short term. 

Short term wave count is still not conclusive or keep on varying but overall medium-term wave counts is indicating an ongoing correction is buying opportunity from medium to long-term perspectives. We have seen the beginning of a broader market (Midcap/Small cap indices) participation this week as well. It closed weekly in positive territory & remained outperformer during the week. Its good sign at current levels of the market for medium to the long-term trend of the market as mentioned last week. Risk reward is favourable to BUY stock specific at current levels of the market.

The short-term outlook for the market remains positive till Nifty trades above 10333 levels and expecting targets in the range of 11170-11450 levels in short term. Medium term outlook for the market remains positive till Nifty trades above 9951 levels and expecting targets in the range of 12500-12800 levels in the medium term.

It may further remain in a broad range between 10000-11000 levels on nifty for some more time in the short term before giving a breakout on the upside. One should closely watch out the upper end of the range at the current level of the market for further confirmation of the same.

BANK NIFTY also closed weekly in positive territory. It managed to hold lower end support levels & sharply recovered at the end of the trading session. It made a low of 26439.60 levels during the week. Its once again closed near the upper end of the range at the end of the weekly trading session as per chart attached. One should watch out its behavior near these crucial levels. Able to break this range on the upside will finally confirm the trend towards higher levels targets till 28500 levels in short term. 23600 level is strong support on bank nifty from medium-term perspectives till it holds one can expect higher levels targets in the range of 30000-32000 levels in the medium term.

10500 & 11000/11200 levels are strong support & resistance levels respectively based on option open interest data for current month series. Any kind of such short-term correction or consolidation is buying stock specific opportunity for medium to long-term Investment perspectives till medium term reverses.

Momentum indicators Daily KST & DAILY MACD both are in sell indicating a volatile trend in short term. One should be stock specific & follow the trend with trail stop loss levels till it reverses. Close or sustain below short-term reversal levels will lead to correction till 10400/10200 levels on nifty & 34672/34000 levels on Sensex in short term.

Stock Picks:

CUMMINS – BUY

CLOSE – Rs 856.10

TARGET – Rs 890-910

CUMMINS closed the week in positive territory. It is outperforming in short term. It has broken out of short term consolidation. Its daily momentum indicators are in BUY. One can buy with a stop loss of Rs 792 for the target of 890/910 levels in short term.

IOC – BUY

CLOSE – Rs 137.80

TARGET – Rs 145/152

IOC closed the daily in a positive territory. It looks like the end of medium term correction. It managed to hold 20DMA. Risk reward is favorable to buy at current levels. Its daily momentum indicators are in BUY. One can buy with a stop loss of Rs 131 for the target of 145/152 levels in short term.

SUN TV – BUY

CLOSE – Rs 614.90

TARGET – Rs 650-670

SUN TV closed the weekly in a positive territory. Its looks like the end of medium term correction. It managed to hold 20DMA. Risk reward is favorable to buy at current levels. Its daily momentum indicators are in BUY. One can buy with a stop loss of Rs 577 levels for the target of 650-670 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 scripts mentioned above.