Nifty to remain range-bound; Jatin Gedia recommends Meesho, 2 others

Jatin Gedia of Teji Mandi has said that he sees range-bound price action between 23,800 and 24,100 in Nifty from a short-term perspective.

Disclaimer: This article is written by Jatin Gedia - VP, technical tesearch, Teji Mandi Investment Technologies Pvt Ltd. Views expressed are his own. Readers' discretion is advised.

 

Nifty opened gap down and thereafter consolidated between 23,800 and 23,900. It filled the gap area between 23,900 and 23,830 and also held the 78.6 per cent Fibonacci retracement level of the 23,606 - 24,774 rally. It witnessed buying interest from the lower end of the reverse channel (23,770 - 23,800) drawn on the intraday charts and closed off the intraday lows. The downtrend is still intact; however, a pullback to the resistance zone 24,000 - 24,050 cannot be ruled out. Thus, we expect range-bound price action between 23,800 and 24,100 from a short-term perspective. 

 

 

Bank Nifty opened gap down towards 57,000, the lower end of the broad range 57,000 - 58,000. It tested the 200-day moving average at 56,800 and witnessed buying interest around the support zone. It closed back within the 57,000 - 58,000 range, suggesting that the range-bound price action is likely to continue. Considering that prices are at the lower end, we can expect a move towards 57,500 - 57,700 over the next few trading sessions. Overall, Banknifty is likely to consolidate between 57,000 and 58,000.

 

Stock recommendations today 

 

Sona Blw Precision Forgings

 

Rating: Sell Sept Fut at ₹785.30; Stop loss at ₹805; Target ₹745

 

Sona Blw Precision Forgings has witnessed a breakdown from the ₹840 - ₹800 range, suggesting a trend reversal from up to down. Multiple negative divergences were visible on the momentum indicator, and Wednesday's price action confirmed the weakness. 

 

SBI Life Insurance Company

 

Rating: Sell Sept FUT at ₹1,731; Stop loss at ₹1,760; Target ₹1,700

 

SBI Life Insurance Company has broken down from a bearish flag pattern, suggesting the resumption of the next leg of the downtrend. Negative crossover on MACD suggests a sell signal. 

 

Meesho

 

Rating: Buy; CMP: ₹211.60; Stop loss at ₹206; Target ₹223

 

Meesho is in an uptrend, forming higher highs and higher lows on the daily charts. It was consolidating between ₹202 and ₹210 for the past eight trading sessions. On Wednesday, it witnessed a price-volume breakout, suggesting resumption of the next leg of the upmove. A positive crossover on the MACD suggests a Buy signal.