Edited excerpts from a chat:
Nifty ended final week round 1% decrease as IT shares pulled the index down. How do you see the market shaping up within the first week of March?
Nifty ended the week on a destructive word because of the fall on the final day, when it slipped beneath the 200 DMA, confirming a destructive sentiment which may persist for just a few extra days. The week began with promoting in IT shares, however the promoting strain spilled over into heavyweight Reliance and the realty pack. The ultimate nail within the coffin got here from the strongest sector, banks. The Financial institution Nifty slipped beneath the 21 EMA for the primary time in lots of days, giving rise to a cautious sentiment. Going into March, I anticipate the stage to be set for a weak market, a minimum of within the first half of the month. Assist on the decrease finish is seen at 24,500. On the upper finish, resistance is positioned at 25,500, above which sentiment would possibly enhance barely.
Within the final 3 days, Nifty IT tried to climb up. What do you suppose is that this a lifeless cat bounce or sustainable uptrend? Is it too early to say that IT shares have bottomed out?
The final three-day bounce within the IT area was feeble, restricted, and unconvincing. Because the index fell beneath the earlier swing low, extra buyers unwound their lengthy positions, as risk-averse sentiment within the area is in place, not the opposite manner round. I imagine that so long as it stays beneath 31,500, the index is prone to stay a promote on rise. On the decrease finish, we would see one other spherical of promoting within the area, taking the index down by one other 8–10%.
Within the final 3 buying and selling classes, have we seen shorts winding up in IT shares?
I don’t really feel so; in reality, extra folks offered on the bounce, resulting in a fall from the three-day excessive.
Metals are doing nicely. What are the charts telling you?
Metals did very well, ending the month as gainers, however the momentum appears to be missing, because the proximity to the higher band of the rising channel has led to lackluster motion. I imagine there’s a robust risk of additional correction within the area. Nonetheless, the basic distinction between metals and IT is that metals nonetheless stay a purchase on dips, however the identical can’t be mentioned for IT.
Tejas was the most important gainer within the week. How would you commerce the inventory now?
The inventory typically strikes as much as give a one-off sort of rally after which retraces again beneath the earlier low, which has been the phenomenon for greater than a 12 months. Nonetheless, this time it appears to be a bit completely different, as the worth rise was backed by considerably larger quantity. The follow-through shopping for on the second day can also be a confirming issue. The inventory needs to be held or purchased with a cease lack of 400, whereas on the upper finish, it’d transfer in the direction of 550.
Give us your high concepts of the week.
Purchase CHENNAIPETRO 962 | SL 929 | TGT 1010
The inventory has given a good upside breakout, resulting in a definitive rise in constructive sentiment, as extra consumers are actually prepared to pay larger costs for a similar inventory. The 21 EMA and 50 DMA are in a bullish crossover, giving a thumbs as much as a constructive pattern. The RSI is in a bullish crossover. Over the brief time period, the pattern is prone to favor the bulls, with potential to succeed in 1010, whereas help is positioned at 929.
Purchase SAILIFE 998 | SL 964 | TGT 1040
The inventory has given a earlier swing excessive breakout, resulting in a rise in constructive sentiment. The value has been sustaining above the 21 EMA and 50 DMA, giving a thumbs as much as a constructive pattern. The RSI is in a bullish crossover. Over the brief time period, the pattern is prone to favor the bulls, with potential to succeed in 1040, whereas help is positioned at 964.
Promote AXISBANK 1383 | SL 1416 | TGT 1330
The inventory has given a consolidation breakdown, elevating a bearish view on the inventory. On the hourly chart, the inventory worth has fallen beneath the 21 EMA, suggesting the emergence of a destructive pattern. The hourly RSI is in a bearish crossover. On the decrease finish, it’d fall in the direction of 1330, whereas resistance is positioned at 1416, above which sentiment would possibly enhance.
