Nifty 50 on 6 January: Recap
After reclaiming the much-anticipated 200-day moving average (DMA) last week, the Nifty and Bank Nifty faltered sharply on Monday, kicking off the week with a sense of panic. While a partial recovery hinted at a bullish bias, the shadow of disappointing Q2 earnings resurfaced, weighing heavily on market sentiment.
Read this | Stock market crash: Sensex, Nifty 50 crack over 1.5% each; HMPV virus scare among 5 factors behind selloff
Adding to the uncertainty, the emergence of the Human Metapneumovirus (HMPV) has sparked fresh concerns, leading to knee-jerk reactions across sectors. With trends remaining fragmented and unpredictable, the market continues to pose challenges for both traders and investors.
Indian stock markets: The way forward
Indian markets opened sharply lower on Monday before staging a partial rebound, though the absence of significant local news flow did little to temper the volatility. Weakness was particularly evident in PSU banks and CPSE stocks, making trading challenging throughout the day.
On the technical front, daily charts highlight a strong resistance zone near 24,900. Once this level was breached, market trends turned weaker, eventually giving way to broader declines. On the downside, the 23,400 level appears to be a key support to monitor in the coming sessions.
Read this | Will foreign investors return to Indian markets in 2025?
Option data remains neutral, but intraday setups indicate oversold conditions following yesterday’s sharp selling. This suggests a potential rally could be on the cards in the short term.
View Full Image
Three stocks to trade, recommended by NeoTrader’s Raja Venkatraman:
• Birlasoft Ltd (BSOFT): Sell below ₹540, stop ₹565, target ₹490
IT stocks remain under pressure following a sharp surge, with the ongoing decline showing no signs of abating. The Relative Strength Index (RSI) has breached the critical 40-level on higher timeframes, signalling a continuation of bearish momentum and reinforcing negative sentiment in the sector. Given these indicators, short positions could be considered.
• Godrej Consumer Products Ltd (GODREJCP): Buy above ₹1,145, stop ₹1,125, target ₹1,235
The value area resistance around 700 had been a hurdle for this FMCG stock, but the strong performance in the last session has provided significant positive momentum. With the sector showing signs of improvement, the buying interest in select stocks is encouraging. As trends appear poised to move higher, considering long positions could be a favourable strategy.
• Apollo Hospital Ltd: Buy at ₹7,440, stop ₹7,340, target ₹8,240
Apollo Hospital has been holding steady, and has shown reasonable upward drive in the last few trading sessions. The strong cloud support on intraday charts and a long body candle seen towards the close of the day indicates onset of bullish momentum can persist. With a positive momentum building, more upside is likely in the coming days.
Also read | Ketan Parekh: Inside Sebi’s 30-month front-running probe
Raja Venkatraman is co-founder, NeoTrader.
Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before making any investment decisions.
