Nifty trend remains weak; move above 23,600 key for recovery: Ajit Mishra

Disclaimer: This article is written by Ajit Mishra, SVP, research, Religare Broking. Views expressed are his own. Readers' discretion is advised.

Market View

Markets staged a recovery on Wednesday following the recent sharp sell-off, gaining nearly half a percent and providing some respite from the prevailing weakness. The rebound was supported by buying in select heavyweight stocks; however, gains remained volatile amid elevated crude prices, global uncertainty and caution ahead of the US Federal Reserve’s policy decision.

The Nifty settled at 23,217.60, up 0.43 per cent, while the Sensex closed at 74,336.45, higher by around 0.45 per cent.

Sectoral participation remained mixed, with FMCG, realty and banking emerging as the key gainers, while IT and pharma ended in negative territory. The broader market continued to underperform and settled largely flat, with mid-cap and small-cap indices witnessing pressure amid profit booking in momentum-driven counters.

 

Investor sentiment remained cautious as Brent crude stayed elevated near $108 per barrel amid continuing tensions in the Middle East and concerns over possible disruptions to global energy supplies.

The rupee remained under pressure near ₹95.95 per dollar, while persistent FII selling continued to act as a key overhang. Markets are likely to react to the outcome of the US Fed meeting and its commentary in early trade on Thursday. Technically, the Nifty’s recovery above the 23,200 level provides some near-term relief; however, the broader structure remains weak. The index is likely to face immediate resistance around 23,400–23,600, while 23,000–23,100 remains the crucial support zone.

A sustained move above 23,600 would be required to signal a meaningful improvement in momentum. Amid the prevailing uncertainties, we maintain a cautious stance and recommend continuing with a hedged approach and selective exposure.

Stocks Recommendations

PB Fintech Limited | LTP: ₹ 1,827.1 | Recommendation: Buy | Target: ₹1,960| Stop-loss: ₹1,760

POLICYBZR exhibits a bullish structure, supported by a decisive recovery from its support zone, coinciding with the 200WEMA. The stock has broken out of a triangular pattern, indicating continuation of the prevailing uptrend. It has also reclaimed and sustained above key moving averages, confirming improving trend strength and renewed buying interest. The recent retest and rebound from the neckline zone, accompanied by higher trading volumes, further validates the strengthening momentum andindicates healthy accumulation. Investors may consider accumulating the stock within the recommended buying range.

PVR INOX Limited | LTP: ₹1,254.6| Recommendation: Buy | Target: ₹1,365| Stop-loss: ₹1,200

The stock has staged a strong recovery from the ₹950 odd level and sustained its up move, reclaiming its key long-term average, i.e. the 200-WEMA. Following a brief consolidation, the stock has formed a fresh buying pivot above its previous resistance zone, indicating renewed buying interest. We expect the stock to sustain its ongoing positive bias, supported by favourable price action and momentum indicators. One can look for momentum-led accumulation while adhering to the mentioned levels.

UPL Limited | LTP: ₹551.4| Recommendation: Sell Futures | Target: ₹528| Stop-loss: ₹563

UPL continues to trade under pressure, forming lower highs and lower lows. The stock has witnessed a breakdown from a broader descending triangular consolidation, signaling a potential continuation of the prevailing bearish trend. Further, the stock is trading below its key short- to long-term moving averages, reinforcing the weak technical structure. Given the current setup, one can consider going short through futures within the mentioned range.