Traders Await Either Side Breakout

Mumbai: On Wednesday, the benchmark indices witnessed lacklustre activity. The Sensex was down by 239 points. Among sectors, PSU Banks and Defense rallied nearly 1 percent, whereas the FMCG index shed 1.40 per cent.

Technically, after a muted open, the entire day the market hovered between 81,200 and 81,600. It also formed a small bearish candle on daily charts, which indicates indecisiveness between the bulls and the bears.

Shrikant Chouhan, Head - Equity Research, Kotak Securities, said: “We believe that the intraday market texture is non-directional; perhaps traders are waiting for a breakout on either side.”

For day traders, now, 81,600 would be the immediate breakout level. Above this, the market is likely to retest the levels of 82,100–82,500. On the other hand, below 24,740/81200 could ac-celerate selling pressure, with support levels at 80,800–80,400.

Prashanth Tapse, Senior VP (Research), Mehta Equities, said: “Markets were extremely range-bound with a negative bias as weak European cues and domestic monthly F&O expiry on Thursday prompted investors to trim their holdings.”

The minutes of the US FOMC meeting held in early May to be released tomorrow will provide some hint to the markets on the direction of the interest rates going ahead.”

Vaibhav Vidwani, Research Analyst, Bonanza, said: “The market traded in a narrow range, re-flecting cautious investor sentiment. The primary reason for the decline was the pressure on the FMCG sector, which was the top laggard, falling nearly 1.5 per cent, led by ITC’s 1.17 per cent drop after British American Tobacco sold a 2.5 per cent stake, diluting its veto power in the company.”

Other sectors like metals and consumer durables also saw mild declines, whereas PSU banks showed relative strength. Global uncertainties such as rising US Treasury yields, ongoing US-EU trade tensions, and anticipation of major economic data releases continue to weigh on senti-ment.

STOCK PICKS

Indus Towers | TRADE-BUY | CMP: Rs391 | SL: Rs375 | TARGETs: Rs410–Rs425

Indus Towers is showing strength after taking solid support around Rs375. The stock has been trading in an upward channel and is now trying to break above recent resistance. If it holds above Rs390, it could move quickly toward Rs410 and then Rs425. The price pattern suggests strong buying interest on every dip. Traders can consider buying at current levels or on a small pullback toward Rs385. A stop loss at Rs375 is advised for risk control.

Vodafone Idea (IDEA) | TRADE-BUY | CMP: Rs7.12 | SL: Rs6.80 | TARGETs: Rs7.50–Rs8.00

Vodafone Idea is forming a base near Rs6.80 and is now trying to move higher with improved volumes. The stock has been under pressure for a while but is showing signs of recovery. If it crosses above Rs7.20 with good momentum, it could head toward Rs7.50 and even Rs8.00 in the short term. Entry near current levels looks attractive, and a stop loss at Rs6.80 should be maintained to manage risk.

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