Short-term outlook for the market remains positive: Devang Shah

Short-term outlook for the market remains positive till Nifty trades above 10557 levels and expecting targets in the range of 11500-11600 levels in short term, says Devang Shah.

NIFTY      

CLOSE- 11,010.20 (20.07.2018)

Market closed the week marginally in negative territory. It consolidated in narrow range throughout the week. It looks like bullish consolidation for the week & market is likely to break these consolidation range on upside in coming trading session.It made a high of 11,076.20 levels so far in this rally. One can expect market to extend further on upside towards 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.

Short-term outlook for the market remains positive till Nifty trades above 10557 levels and expecting targets in the range of 11500-11600 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 12000-12200 levels in medium term.

There is still strong divergence is going on  between Nifty/Sensex main indices & Broader Market in short term And we have seen sharp sell off particularly in broader market in near term. I feel this divergence is going to end soon And we will see strong rebound in broader market. These broader market indices has to catch up with main indices nifty/sensex & join this party of wave-5. This correction is opportunity to BUY quality beaten down stocks of midcap & smallcap index from medium to long term perspectives. 

It also looks like End of medium term correction particularly midcap & smallcap Indices with ending diagonal pattern. One should also closely watchout broader market behavior at current levels to finally confirm the same. One should expect broader market to strongly rebound & Participate in rally with main indices Nifty & Sensex soon.

BANK NIFTY closed weekly marginally in negative territory. Its still outperforming in short term. Its also extending on upside towards higher levels targets in short to medium term. It made a high of 27,233 levels so far in this rally. 26000 levels is strong support for bank nifty for short term, till it holds one can expect higher levels targets till 27700 levels in short term & further above 29600-30000 levels in medium term. Any kind of decline is also buying opportunity for bank nifty for short to medium term perspectives. 

10600/10800 & 11000/11200 levels is strong support & resistance levels respectively based on option open interest data for current month series expiry perspectives. By looking at current structure, I feel market is going to surpass all time high soon across all indices & 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 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 10300-10200 levels on nifty & 33600 levels on sensex in short term.

Stock Picks: 

GRANULES INDIA- BUY

CLOSE– Rs 91.65

TARGET– Rs 98-105
 

GRANULES INDIA closed the weekly in positive territory. It’s out performing in short term. 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-80 for the target of Rs 98-105 levels in short-term. 

L&T- BUY

CLOSE– Rs 1,270

TARGET– Rs 1,315-1,350
 

L&T closed the weekly in negative territory. Its still trading near 20 DMA. Risk Reward is favorable to BUY at current levels. One can BUY with a stop loss of Rs-1205 for the target of Rs-1315-1350 levels in short-term. 

DHFL- BUY

CLOSE– Rs 611.30

TARGET– Rs 645-680
 

DHFL closed the weekly in positive territory. Its outperforming in short term. 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-575 for the target of Rs-645-680 levels in short-term. 

GODREJ IND- BUY

CLOSE– Rs 588

TARGET– Rs 620-634
 

GODREJ IND closed the weekly in positive territory. Its outperforming in short term. 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-559 for the target of Rs-620-634 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.