Short-term outlook for market remains positive; Buy Godrej, Nalco, CEAT

Short-term outlook for the market remains positive till the Nifty trades above 10,585 levels and expecting targets in the range of 11,300-11,700 levels in the short term, says Devang Shah.

NIFTY      

CLOSE- 11035.40  (08.03.2019)

The market closed weekly in positive territory. Last week, it extended gain on the upside, as expected, broke out of consolidation range of last 4-5 months on the upside. It has made a high of 11,089.05 levels on the Nifty and 36,830.25 levels on the Sensex so far in this rally. One can expect the market to extend towards higher levels targets as mentioned below till it reverses. Any kind of decline or consolidation is a buying opportunity until short term reverses.

It looks like the beginning of wave-III of 5 after long consolidation in the range from wave count perspectives. Participation from the broader market (particularly midcap and small-cap indices) from the last couple of days are a good sign at current levels of the market, as expected. It has to catch up now for further confirmation of the overall trend of the market. It looks like a high possibility end of this divergence at the recent bottom and from now onwards, we will get broader market rally for higher levels targets in the short-to-medium term. Risk reward is favourable to BUY stock specific at current levels of the market.

The short-term outlook for the market remains positive till the Nifty trades above 10,585 levels and expecting targets in the range of 11,300-11,700 levels in the short term. The medium-term outlook for the market remains positive until the Nifty trades above 9,951 levels and expecting targets in the range of 12,500-12,800 levels in the medium term.

BANK NIFTY also closed weekly in positive territory. It has also broken out of consolidation range of upside, as expected. It also looks like wave-III of 5 beginning on bank nifty. 26,700 levels is strong support on bank nifty, till it holds, one can expect higher levels target1-28,700/28,800 and target2-29,500 levels in the short term. 23,600 levels is strong support for medium-term perspectives, and till it holds, one can expect higher levels targets in the range of 30,000-32,000 levels on medium-term perspectives.

10,800-11,000 & 11,500 levels is strong a support and resistance levels, respectively, based on option open interest data for expiry perspectives for the current month series. Any kind of such short term correction or consolidation is a stock-specific buying opportunity for medium-to-long term investment perspectives till the medium term reverses.

Momentum indicators, Daily KST & DAILY MACD, both are in BUY supporting short term trend of the market. One should be stock specific and follow the trend with trail stop loss levels until it reverses. Risk reward is favourable to BUY at current levels of the market. Close below short term reversal levels will lead to sharp correction till 10,300 levels on the Nifty and 34,400 levels on the Sensex in the short term.

Stock Picks:

JAIN IRRIGATION – BUY

CLOSE – Rs 60.55

TARGET – Rs 64/68
 

JAIN IRRIGATION closed weekly in positive territory. It looks like an end of medium-term correction. 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 57.70 for the target of Rs 64/68 levels in the short term.

NALCO – BUY

CLOSE – Rs 57.15

TARGET – Rs 60/63
 

NALCO closed weekly in positive territory. It looks like an end of medium-term correction. 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 52 for the target of Rs 60/63 levels in short term.

CEAT – BUY

CLOSE – Rs 1,122

TARGET – Rs 1,180/1,220
 

CEAT closed weekly in positive territory. It looks like an end of medium-term correction. 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 1,080 for the target of Rs 1,180/1,220 levels in the short term.

GODREJ IND – BUY

CLOSE – Rs 515

TARGET – Rs 530/545
 

GODREJ IND closed weekly in positive territory. It looks like the end of medium-term correction. 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 490 for the target of Rs 530/545 levels in the short term.

CUMMINS – BUY

CLOSE – Rs 732.45

TARGET – Rs 760/775
 

CUMMINS closed weekly in positive territory. It looks like an end of medium-term correction. 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 700 for the target of 760/775 levels in the short term.

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.