In the past, whenever the market has opened lower on the day of the weekly expiry of contracts, Nifty has closed in the negative territory with a hefty loss. Wednesday’s session saw a similar trend as the benchmark indices closed in red with a loss of over 1 per cent. There was heavy unwinding in long positions of metal stocks, while auto, pharma and midcaps saw selective buying. The index has formed a bearish continuation formation. However, as the market is range-bound, till Nifty/Sensex does not close below the levels of 14,600/48,400, we could do a pullback towards 14,800/49,000 levels. The focus should be on cements, PSU banks and auto stocks if the market remains strong. Buy metal stocks if the market drops to 14,500/48,100 levels.Tech Picks
Analyst: Shrikant Chouhan, Executive Vice President – Technical Research
CMP: Rs 398.8
Target price: Rs 410
Stop loss: Rs 392
After a reversal formation from its important retracement zone, the stock closed above its 20-day EMA on the daily chart, indicating bullish continuation.
CMP: Rs 265.3
Target Price: Rs 275
Stop loss: Rs 260
A breakout from the ascending triangle chart formation is very likely for a fresh-up move in the near term.
CMP: Rs 115.1
Target price: Rs 119
Stop loss: Rs 112
The incremental volume activity in the recent past indicates a strong fresh breakout from the symmetrical triangle chart pattern.
Motherson Sumi: BUY
CMP: Rs 235.9
Target price: Rs 243
Stop loss: Rs 232
The stock is trading in an ascending channel with a higher high and higher low chart formation on the daily chart.
Sahaj Agrawal, Head of Research – Derivatives
May Futures: BUY at Rs 14,335;
Stop loss: Rs 13,800
Target price: Rs 14,900
Trendline breakout seen above Rs 14,300 on spot.
Nifty Bull Call Spread: 27 May- SERIES:
Buy 14,700 CE at 230 and Sell 15,000 CE at 100;
Premium Outflow: 130
Stop loss: 60
Nifty trend bullish above 14,400 on spot. With market breadth remaining positive, it can retest 15,000+ levels.
Forex & Interest Rate Technical
Anindya Banerjee, DVP, Currency Derivatives & Interest Rate Derivatives
USD-INR May Futures: Sell between 73.75/85; stop loss: 74.05; target: 73.30/10
GBP-INR May Futures: Buy between 103.50/103.70; stop loss: 102.80; target: 105.00/105.30
GBP-USD May Futures: Buy between 1.4080/1.4100; stop loss: 1.3970; target: 1.4250/1.4300
Ravindra Rao, CMT, EPAT, VP- Head Commodity Research at Kotak Securities
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Source: Day trading guide for Friday