On a weekly basis, the Nifty 50 index gained more than 1 percent to close at 15849.35 levels, whereas Bank Nifty climbed over 2.2 percent to close at 35334.10 levels followed by good fourth quarter corporate earning with consistent demand and recovery in COVID-19 cases and unlock phase in the country.
The bulls were active from the first day of the week. We witnessed good upside momentum in all the indices, led by the Nifty PUSBANK, Metal and IT sector which supported the index to close into positive territory. A few stocks like Maruti, Tata Steel, Infosys, Vedanta and Bajaj Financial Services performed outstandingly with a good amount of gain while Reliance Industries, India Bull Housing, Asian Paints, HUL were the weekly laggards.
Technically, the benchmark index has been trading in Higher Highs and Higher Lows formation for the last couple of weeks, which indicates a continued upward trend in the market. Moreover, in the recent trend, the prices are consolidating near to immediate resistance of 15,900. Breaching that level may extend the rally towards the new milestone. In addition, an oscillator Stochastic has also suggested positive crossover, which suggests bullish strength for the near-term.
For the upcoming week, if the Nifty breaks the 15,900 mark, then it may move towards the level of 16,100/16,200 levels while immediate support is shifted up to 15,650 levels.
Top gainers for week ended June 25
Maruti has given a weekly breakout of 7,400-levels, after testing its previous support levels. The stock has closed above its 15-days Moving Average which indicates a strong trend on the upper side. The momentum indicator is pointing on the upper direction which indicates a further northward move for the stock. The convergence and the divergence line of the stochastic have given a positive crossover which indicates a strong upside move for the stock. The support lies at 6,800 while the resistance lies at 7,800-levels. Overall, the stock has a very strong bullish trend for the short term; mild profit bookings might be seen which could be a good opportunity for fresh buying.
After a sideways to bearish move, the stock gained more than 5 percent on Friday trading session and settled above the Ichimoku Cloud, indicating a good bull trend in the near term. The Momentum indicator is pointing on the upside direction which indicates a further bull side for the stock. The convergence line of the stochastic has given a positive crossover over the divergence line indicating positive momentum for the stock. The support levels lie at 1,040 and resistance at 1,190 levels. Overall, we are recommending a buy on Tata steel for the target of 1,240. However, on the downside, support comes at 1,110 levels.
During the week, the stock gained more than 4 percent to close at 1,574.20 levels. On the daily chart, Infosys has settled above the 21 days moving average which indicates a positive direction for the stock. The stock has given closing above the convergence line of the Ichimoku Cloud formation. However, The Stochastic indicator has given a dicey crossover which indicates a caution. The stock has the support of 1,450 and resistance of 1,600. Overall, we are expecting some profit in the counter for the upcoming week.
Bajaj Financial Services
On a weekly chart, the stock has formed Open Bullish Marabozu Candlestick Pattern which points out strength in the counter. The stock has given breakout of the previous resistance level and made all-time high at 12,512 levels which indicates strength in the counter for upcoming days. The stock has been trading with a positive crossover of 21*50 daily Moving Average which can be considered as a Bullish Crossover which shows a Bullish movement in the counter. Furthermore, the price has also moved above the upper “Bollinger Band” formation, which suggests the bullish rally will continue further in the near term. At the present level, the stock has good support at 11800 level while resistance comes at 12,600-13,000 levels.
State Bank of India
On a weekly chart, the stock has formed Bullish Engulfing candle, which suggests further upside movement in the counter. The stock has given a breakout of the falling trendline which points out strength in the counter. A momentum indicator RSI and MACD both have shown positive crossover on the daily chart which adds more bullishness to the price. Moreover, the stock has been trading above 21&50 DMA, which further adds strength to the counter. At present level, the stock has good support at 401 levels, sustains above the 420 level can show 460 levels.
During the week, the stock showed profit booking from the yearly high and corrected almost 5 percent to close at 2,104.50 levels. Overall, the stock has taken support from 50 percent RL from its previous up move sustains above the same can show bounce-back movement in the counter. Moreover, the stock has confirmed three black crow candlestick patterns on a daily time frame which points out weakness in the counter. A momentum indicator RSI (14) & Stochastic have suggested negative crossover on the daily chart. However, the prices are still trading above 50 DMA, which confirms limited downside and support at around 2,050 levels.
On a weekly basis, the stock has shown mid-profit booking from the prior high and settled at 17,500 on Friday's trading session. Moreover, the stock has closed below the Middle Bollinger Band formation, which indicates an immediate hurdle for the counter. In addition, the stock has also slipped below 21-days SMA. A momentum indicator MACD & Stochastic suggested negative crossover on the daily time-frame, which confirmed a bearish move for the upcoming sessions. On the downside, the stock may test the support at 17,000 marks while resistance comes at 18,200 levels.
The stock was trading in the Rising Channel formation where it has found resistance at the upper line of the formation and retreated further for a week with 1.3 percent downfall. It has also tested an upper Bollinger Band formation and dragged lower, which suggest further profit booking for the upcoming week. A momentum indicator RSI turned from the overbought zone and stochastic indicated negative crossover, which suggests some weakness for the near term. Downside support is at 2,320 while resistance is at 2,550 levels.
Kotak Bank has been trading between the ranges of 1,700-1,830 for the last couple of days. In the recent week, it has shifted below the Ichimoku Cloud formation and 50-Days SMA, which suggests some weakness in the counter. Moreover, an indicator MACD an Stochastic suggested a negative crossover that confirms the downside move in the stock for the near term. For the upcoming week, if the stock settles below the 1,700 level, we will see some correction till the 1,630 levels. On the lower side, support is at 1,600 levels while resistance comes at 1,850 levels.
The stock has been trading in a Rising Trend with Higher Highs and Higher Lows formation from the last couple of weeks, which indicates a bullish trend for the long term. However, in the recent week, the stock showed mild profit booking at the higher levels. A momentum indicator RSI and MACD is suggesting a positive bias for the near term. Action in volume activity is also showing an upward direction for the upcoming week. Hence, we are recommending buy-on dips strategy in Asian Paints around 2,950-2,960 levels with the SL of 2,850 for the upside target of 3,100/3,180.
(Sumeet Bagadia, is Executive Director, Choice Broking)