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The Bulls maintained their winning streak for the third straight week, propelling the benchmark to new records. It was an eventful week overall, marked by the Nifty entering uncharted territory and ultimately closing with weekly gains of 1.50%, just short of the 26,200 zone.
In a market environment devoid of bearish activity and supported by positive global indicators, the benchmark index continued to climb to record highs even with overloaded technical and derivative indicators. Additionally, sector rotation provided the essential impetus to drive recent market activity. It’s been almost 10 odd months, our markets have continued their gravity-defying course; but looking at the quarterly chart we came across an interesting observation and it
it would be unfair not to highlight this.
From the March 2020 low, NIFTY had formed a bull flag pattern consisting of a pole with six quarterly candles. We have precisely reached the target (26,276) of this pattern with precisely six quarterly candles. Although it has become difficult to predict when the market will make a healthy, much-needed correction, such a significant development in conditions of extreme overbought in all major technical indicators, staying light and avoiding aggressive positions appears to be a prudent ploy. Level-wise, the 26,000 area should provide a cushion, followed by a series of supports placed between 25,800 and 25,700 during the comparable time frame.
On the other hand, 26,250 to 26,300 remain immediate hurdles, and as we move forward, these levels can certainly be revised.
Wider participation by mid-sized companies and selective heavyweights will likely remain at the forefront amid sectoral upheaval. At the same time, it is crucial to closely monitor global markets, as any aberrations could potentially disrupt the current dynamics of our domestic markets.
NSE Script – Canara Bank
View – bullish
Last close – Rs 113.10
Canara Bank showed a strong resurgence of the pivotal support of 200 SMA on the daily chart and bounced back to witness a breakout of the sloping channel. The price movement was supported by a notable increase in trading volumes, creating robust sentiment towards the market.
Going forward, the breakout on the daily chart is likely to trigger bullish traction in the comparable time frame. From a technical perspective, the indicators rebounded to witness a positive crossover, signaling an upward trend in the stock.
Therefore, we recommend BUY Canara Bank around: Rs 110 | Stop-loss: Rs 104 | Target: Rs 122
Scrip NSE – Coal India
View – bullish
Last close – Rs 516.10
Indian coal is in meteoric bullish momentum, oscillating in a cycle of higher highs and higher lows over a broader time frame. During the recent session, the counter re-emerged from the lower band of its ascending channel, coinciding with the 100 DEMA support to continue its main trend.
Additionally, on the oscillator front, the MACD signals strong momentum, suggesting a potential upward journey into uncharted territory for the counter.
Therefore, we recommend you to BUY coal in India around: Rs 515-510 | Stop-loss: Rs 486 | Target: Rs 574
(Osho Krishan is a Senior Technicals and Derivatives Analyst at Angel One Ltd. The opinions expressed are his own.)
First publication: September 30, 2024 | 7:21 a.m. STI