Mumbai: On Wednesday, the benchmark indices witnessed profit booking at higher levels as BSE Sensex was down by 790 points.
Among sectors, all the major sectoral indices registered intraday profit booking, but Media index corrected the most shed over 3.5 per cent. Technically, after a muted opening the index breached 72,800 support zone and post breakdown the selling pressure intensified.
In addition, on daily charts the index has formed long bearish candle, which indicates further weakness from the current levels.
“For the traders now, as long as the index is trading below 72,800 the weak sentiment is likely to continue. Below the same, the market could slip till 72,000-71,850,” says Shrikant Chouhan, Head Equity Research, Kotak Securities. On the other side, above 72,450 we could see a one minor pullback rally till 72,600-72,700. Prashanth Tapse, senior V-P (research), Mehta Equities, says: “Weak Asian market cues and Dow Futures indicating a negative start triggered massive profit-taking across the board as benchmark Sensex closed below the crucial 73k mark.”
There will be strong bouts of intra-day volatility going ahead as the wait for interest rate cuts is getting longer, and hence investors are taking selective bets in view of the already stretched valuations.
Stock Picks
Havells (BUY)
CMP: 1534.35 | SL: 1440.00 | Target: 1750.00 and 2000.00
The stock has given a good breakout above its October 2021 highs and managed to close above the same despite negative market sentiments. A strong technical structure, along with the stock making higher highs and higher lows, indicates that the stock is in a strong uptrend. At current levels, with a stop loss of 1440 for the short term, Havells is looking like a good buy.
Syngene International (SELL)
CMP: 708.90 | SL: 740.00 | Target: 680.00 and 660.00
The stock has given a good breakdown below its recent support levels, showing a strong selling signal. It has violated its recent swing low of 722 and closed bearishly below the same. The next support is now at the 680 and 660 marks, which should serve as potential targets for the short setup.
(Source_Riyank Arora Technical Analyst at Mehta Equities)
