57,800pts a key support level
On Monday, the market continued the positive momentum, fourth day in a row.
Equities end marginally lower, extend losses for fifth straight day
Mumbai: On Monday, the market continued the positive momentum, fourth day in a row. The benchmark BSE Sensex was up by 519 points. Among sectors, except pharma all the major sectoral indices were traded in the green, but Nifty Auto Index Outperformed, rallied over three per cent.
Technically, in last four days, BSE Sensex rallied over 2,900 points. Currently, the market is comfortably trading above 200-Day SMA and still holding higher high and higher low formation on intraday. "However, due to temporary overbought conditions, we could see quick intraday correction in the near future. For the trend following traders, now 57,800 would act as a key support level, above which the index could move up to 58,350-58,500," says Shrikant Chauhan, Head of Equity Research (Retail), Kotak Securities.
On the flip side, quick intraday correction possible below 57,800. Below which, the index would retest the level of 57,500-57,300. Short-term traders should remain cautious and be very selective as there is a risk to get trapped at higher levels.
Stock Picks
ITC: Stock has closed at 52-week high, but momentum looks strong on weekly charts for an upside momentum to continue to Rs326 which can be short term target, while SL can be at Rs294
Coforge: Stock has consolidated near to 5 days average last week with accumulation on weekly charts. Stock is expected to give a bullish crossover on indicators if we see move above Rs3,950. Therefore, stock can be bought positionally for targets of Rs4,050/4,175 with stop loss of Rs3,780
(Source-Kush Ghodasara)
