The Nifty carried forward its momentum as it managed to close above the critical 11,000-mark. Though it is away from its short term averages of 5 & 20 DEMA, the fanning of its 20 & 50 DEMA along with close above-the-oscillation range bodes well for retest and breach of recent high around 11,118 levels. OI band shifting higher with highest call OI currently at 11,500 levels while significant put addition at 10,900 levels suggests an upward shift in the trading range. Also, the directional indicator ADX line placed around 19 with its positive directional indicator placed comfortably above 30 is a good indication of a sustained trend. With both the Small & Mid Cap indices recording fresh 52-week highs along with the overall price setup augurs well for the follow-through move to target towards 11,260 in coming sessions. Short term and positional traders should continue holding longs with a revised stop below 10,810.
CMP: Rs 1,327.25
The stock witnessed followthrough move after the occurrence of “bullish hammer candlestick on February 26. Yet another occurrence of bullish candlestick being “Belt Hold” confirms short-term bottom placed at recent lows of Rs 1,245.75. The current setup indicates the stock is expected to test and breach above the consolidation resistance placed around Rs 1,370 in coming weeks. Significant call addition at Rs 1,300 levels and a breach above the same in current trading sessions support the overall bullish outlook. Hence, short-term traders can initiate longs for a retest of Rs 1,370 to be obtained in coming sessions with a stop placed below price confluence support of Rs 1,310 levels.
BUY RELIANCE INDUSTRIES
CMP: Rs 1,265
The occurrence of ‘Inverse Hammers’ reconfirmed the strength of the support around Rs 1,210-1220 zone. The formation carries the characteristics of a ‘Double Bottom’ being established on the daily scale as its RSI had managed to maintain its tail above its 50-mark. The price momentum could aggravate above Rs 1,285 and hence any declines should be bought with a stop below Rs 1,215 for a pattern target upto Rs 1,310.