Podcast | Stock picks of the day: 'Nifty could hit 12,400 in medium term, stay long'

BankNifty has registered a new lifetime high at 29,812 on Monday. From the bottom of February 19, 2019, Nifty has risen by about 9 percent, while the Bank Nifty has risen by 12 percent in the same period.

The Nifty50 is in continuation of the bullish trend. Support levels are now slowly shifting upward to 11,200 odd levels. The momentum indicators like ADX and MACD are showing full strength on charts and signal further rally in the market.

The only resistance, which we see in Nifty for the short term is the previous all-time high of 11,760, which is expected to be taken off soon.

The target of the current uptrend is seen at 12,430 levels, which happens to be 138.2 percent Fibonacci retracement of the entire fall seen from 11,760 (All Time High registered in Aug 2018) to 10,004 (Oct 2018 Bottom).

BankNifty is expected to continue its rally towards the next target of 30,400. A previous all-time high of 28,388 would now act as support going forward. Short term support for the BankNifty is seen at 28,800.

The Nifty Midcap Index is on the verge of surpassing the resistance of 200-DMA. The Nifty Smallcap Index has been consolidating for the last 5 straight sessions. Surpassing the 5 days high would result into fresh breakouts in the Smallcap and Midcap Index.

As far as world markets are concerned, Dow Jones resumed its uptrend after two weeks of a healthy correction. European markets FTSE, CAC and DAX have been going strong. Asian Markets are also placed well technically.

So the global scenario is also favouring the bulls right now. At current levels, we see trading opportunity in the sectors like Banks, NBFCs, Energy, and PSUs. Sectors like I.T and Auto could underperform in the short term.

To conclude, investors should remain net long in Nifty. Short-term support is seen at 11,200 in Nifty and 28,800 in Bank Nifty, and any dip should be accumulated for the upside target of 11,760 in Nifty and 30,400 in BankNifty.

Nifty50 has got a good potential to extend the current rally towards 12,400 in the medium term.

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