The index has to continue to hold and sustain above 10,929 zones to extend its gain towards 11,080. If the index slips below 10,929, the selling pressure could extend towards 10888 zones.
Monday blues hit D-Street! The S&P BSE Sensex closed 217 points lower on Monday while Nifty breached its crucial support placed at 11,000 on the downside.
Mid and smallcap stocks bleed the most. Both indices saw deep cuts of over 2 percent in trade today. Some experts believe that money is moving from the mid & smallcap space to largecaps which contributed to the rally seen in markets in July. Rise in margin requirement is also hampering the investor sentiment as well as liquidity.
A market which hit a record high on Friday saw over 400 points hitting fresh 52-weeks low on the BSE and 300 stocks on the NSE on Monday which is not a healthy sign for the bulls.
Market is likely to remain volatile in the short term owing to global trade concerns.
It looks like Bears are putting pressure at higher levels. The index has to continue to hold and sustain above 10,929 zones to extend its gain towards 11,080.Any major declines towards key support levels should be used as an opportunity to get into quality names in the consumption and financials space.
If the index slips below 10,929, the selling pressure could extend towards 10888 zones.
Analysts’ advise investors to adopt a buy on dips strategy as long as Nifty holds 10800 levels.
HUL numbers would be in focus on Tuesday. The FMCG major said that the profit on standalone basis grew by 19.2 percent to Rs 1,529 crore for the quarter ended June, backed by domestic volume growth and operational performance.
Tuesday promises to be an action-packed day as 23 companies on the BSE will be declaring their results for the quarter ended June which include names like 8K Miles, Ashok Leyland, Federal Bank, Jindal Stainless, Rallis India, Sintex Industries, Tata Sponge and Zee Entertainment.
Federal Bank: PAT likely to rise by 19 percent on a YoY basis to Rs 250 crore
Ashok Leyland: PAT likely to rise by 176 percent on YoY to Rs 331.60 crore
Zee Entertainment: PAT likely to rise by 50 percent YoY to Rs 377.40 crore
Technical View:
The Nifty index failed to hold above the psychological 11000 level and formed a Bearish Belt Hold kind of Candle on a daily scale. Let’s understand what a Bearish Belt Hold is...
A ‘Bearish Belt Hold’ pattern is formed when the opening price becomes the highest point of the trading day (intraday high) and the index declines throughout the trading day making up for the large body. The candle will either have a small or no upper shadow and a small lower shadow.
On the options front, maximum Put OI is at 10,600 followed by 10,700 strikes while maximum Call OI is placed at 11,000 followed by 11,100 strikes.
Three levels: 10888, 10929, 11000
Max Call OI: 11000, 11100
Max Put OI: 10600, 10700
Technical Recommendations:
We spoke to Religare Broking Ltd and here’s what they have to recommend for intraday trading:
Havells India: Buy | Target: Rs 590 | Stop loss: Rs 540 | Return 5.35%
Hindalco Industries: Sell July Futures| Target: Rs 195 | Stop loss: Rs 225 | Return 9.30%
Larsen & Toubro: Sell July Futures| Target: Rs 1,240 | Stop loss: Rs 1,315 | Return 3.72%Disclaimer: The views and investment tips expressed by investment expert on moneycontrol.com are his own and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
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