Market Texture Remains Non-Directional

Mumbai: On Thursday, the benchmark indices witnessed a sharp selloff as BSE Sensex was down by 500 points. Among sectors all the major sectoral indices registered profit booking at higher levels, but realty and auto lost the most fell over 3.5 per cent. Technically after a muted opening Nifty breached important level of 81,500 and post breakdown the selling pressure intensified. On daily chart the index has formed bearish candle and on intraday charts it is holding a lower top formation.

Shrikant Chouhan, head (research), Kotak Securities, said: “We are of the view that the market texture is weak and as long as Nifty trades below 81,500 weak sentiment is likely to continue. On the downside, the market could slip till 80,900-80,600. On the flip side, above 81,300 we could see a one quick pullback rally till 81,400-81,500. Above 50-day SMA or 81,800 the sentiment could change. Above which, market could retest the level of 82,100-82,400. The current market texture is non-directional. Hence, level-based trading would be the ideal strategy for the day traders.”

Prashanth Tapse, senior V-P (research), Mehta Equities, says: “Markets continued its downward trajectory despite firm US and European cues, as foreign fund selling coupled with a sharp fall in automobile stocks ahead of the final day’s IPO subscription of Hyundai weighed on sentiment. As expensive valuations continue to bite, banking, realty, metals and telecom shares also attracted significant profit-taking.”

STOCK PICKS

Gandhar Oil Refinery (India) | TRADE-BUY | CMP: Rs243.85 | SL: Rs235 | Target: Rs257.50-Rs260

Gandhar Oil is approaching a key resistance level near Rs250, with a potential breakout imminent. The stock is trading above its support of Rs235, supported by a positive RSI, indicating strong bullish momentum. A breakout above Rs250 would push the stock towards the target range of Rs257.50 and Rs260. Maintain a stop loss at Rs235 to manage downside risk if the trendline is breached.

Five-Star Business Finance | TRADE: BUY | CMP: Rs894.75 | SL: Rs870 | Target: Rs925-Rs950

Five-Star Business Finance is trading near a support zone of Rs870, showing signs of strength. The stock is on an upward trendline, with an RSI indicating further bullish momentum. A breakout above Rs900 could drive the stock towards its resistance levels at Rs925 and Rs950. Maintain a stop loss at Rs 870 to safeguard against potential downside.

(Source: Riyank Arora, technical analyst at Mehta Equities)

CMP (Current Market Price); SL (Stop Loss)/All prices in Rs