Market hovering in non-directional trading

Mumbai: On Thursday, the benchmark indices witnessed a volatile trading session, after a roller-coaster activity the Nifty ends 80 points higher, while the Sensex was up by 351 points. Among sectors, private banks and IT indices rallied over one per cent whereas Oil and Gas index the top looser, shed over one per cent.

Technically, after a gap-up opening, the market witnessed a sharp intraday correction. However, it trimmed some losses in the second half and eventually it close at 74,228 points higher. Currently the market is witnessing non-directional activity. On the lower side, it is consistently taking support near 73,500 points, while it regularly facing selling pressure near 74,400 points.

“For the bulls now, the 74,400 and 74,500 would act as key resistance areas. After dismissal of 74,500, the market could rally up to 74,800-75,000. On the flip side, below 73,500 the sentiment could change,” says Shrikant Chouhan, head (equity research), Kotak Securities. Below 73,500, the market could retest the level of 73,100-7,800.

Prashanth Tapse, senior V-P (research), Mehta Equities, says: “Gains in frontline IT and private banking stocks buoyed Sensex & Nifty to fresh record highs in a highly volatile session. Despite the recovery, volatility may still persist due to renewed uptick in US bond yields on fading hopes of a rate cut over next few months.”

This will continue to weigh on Indian markets too, and along with FII selling pressure, local equities may continue to face the heat.

Stock Picks

Vedanta Ltd

CMP: 309.95 | Stop Loss: 298 | Target: 330

The stock has broken out above its May 2023 swing high mark of 300.95 on its weekly charts. A minor support is placed at the 297 mark, below which the stock should lose strength. With the overall trend being positive and the outlook on metal stocks being bullish, we can expect Vedanta to eventually head towards 330 and above, with a firmly set stop loss below the 298 mark.

DABUR

CMP: 506.05 | Stop loss: 497.50 | Target: 530

The stock has touched a major support mark of 503.00 on its daily and weekly charts. At the current market price of 506, the risk-reward looks favorable on the buying side with a set stop loss below the 497.50 mark. Overall positive trend structure and low risk at current levels make Dabur an interesting buy at present levels for potential targets of 530 and above.

(Source_Riyank Arora Technical Analyst at Mehta Equities)