Markets are still range bound. Do you expect any kind of breakout in the near future or do you expect markets to stay close to the 24,700-24,800 range?
Vinay Rajani: For the last seven trading sessions, the Nifty has been gradually moving higher. The trend has been bullish and the Nifty is trading above all the important moving averages. The nearest moving average that we are tracking is the five-day exponential moving average, which is located around 24,700. So the market trend is bullish, there is no doubt about it.
However, somehow the momentum, the kind of strength that should be there in this kind of market is missing in the large-cap market. But gradually, the way the market breadth is holding, the way microcap and smallcap indices are holding their strength, it should be a good opportunity to buy on a dip. The overhead support around 24,700 should be the entry level for intraday traders and for the next week also if Nifty turns down from 24,650 to 24,700, it is the level at which one can initiate a fresh long position.
Next week, I expect the Nifty to break above the all-time high which was at 25,078 odd levels and to be bought on intraday dips and 24,700 is a very strong support which could be leveraged for buying. The overall trend remains bullish and as the market breadth is very strong, the breakout of the Nifty and Nifty Bank I would be on the higher side and I expect to see 25,100 broken out next week.
After a few days of subdued trading in Nifty Auto, we are seeing some movement today. It is up around 1 percent on the back of two-wheeler stocks like TVS, Hero and Bajaj CarsHow do you see it? car stocks at the moment?
Vinay Rajani: There is a breakout in Bajaj Auto. The two-wheeler sector has started performing well and the auto index saw a continuous correction and started moving up after that. It has started forming a higher top and bottom formation on the daily charts. The Nifty Auto index looks strong and is likely to participate in the coming times and especially the Bajaj Auto looks the strongest as it has taken the lead and made a fresh breakout on the charts, followed by MotoCorp Hero also.
There are many stocks in the large cap sector. Even if we talk about the auto sector, many stocks have corrected in the last 15 days and have room to rise from now. Therefore, stocks like Tata Motors, Maruti They can participate as they are a bit oversold on the short term charts. They can also come and participate in the market. Many large cap stocks have corrected well and are likely to participate in the coming times. But if I had to pick one stock from the auto sector, Bajaj Auto looks the strongest.Nifty Realty Index is the biggest loser of August, down 6% so far. Do you think this downward trend will continue in the property index or is it just a one-month blip we are currently seeing?
Vinay Rajani: It looks weak. It is trading below its 50-day and 20-day EMAs and has been underperforming. And the way it is going, I think if anyone wants to make a long bet, then the Nifty real estate index should be avoided because technically it looks weak. I can see some weakness and underperformance. So, if the market consolidates, this real estate index is likely to fall. I expect underperformance of this particular index. Many stocks and sectors look stronger than other sectors like automobile which has started outperforming, banking has not performed, which is gradually improving. So, there are many sectors which can outperform in this market. But the real estate index looks weak on the charts and I would prefer to ignore the possibility of buying in any stock of this particular index unless I get a confirmation of some resistance being breached in the coming days. So, I will wait and watch and it is likely to underperform in the coming sessions.
Any standout picks for the day?
Vinay Rajani: Unilever Hindustan You can see that. It is trading around Rs 2,800, so if you keep a stop loss at Rs 2,750, you can buy it and I expect an upside of at least Rs 100. It is a large cap company. Consumer Goods Stocks and the FMCG index is performing very well. HUL can be traded long with a stop loss of Rs 50 and an upside target of Rs 100.
Disclaimer:
The information contained in this post is for general information purposes only. We make no representations or warranties of any kind, express or implied, about the completeness, accuracy, reliability, suitability or availability with respect to the website or the information, products, services, or related graphics contained on the post for any purpose.
We respect the intellectual property rights of content creators. If you are the owner of any material featured on our website and have concerns about its use, please contact us. We are committed to addressing any copyright issues promptly and will remove any material within 2 days of receiving a request from the rightful owner.