July 23, 2018 – Weekly Market Analysis

$Nifty is trading in narrow range, just 150 points in last 7 trading sessions. Today, morning I was having a talk with my father and he said “when market moves like this, it generally means it is going to reverse or head for a huge breakout”

Here is a $nifty chart for reference

nifatyn

If history does rhyme in market and repeats itself to some extent, when was the last time this kind of range-bound movement happened. Well, not so far ago. It was back in December 2017, $Nifty remained in 150 points range for 12 trading sessions and broke out on 13th. I have attached the chart for reference.

niy

 

Well, this does not mean that market will do exactly the same movement again but yeah you know what to do at-least this time if we get an extension towards 11100. One thing probable to happen is that if this range gets broken either side, expect 500 points sharp move. 10400 OR 11600.

To confirm this kind of “sharp move” thesis, I went back to first quarter of 2017, market remained in 150 points range for 13 trading sessions. Chart for reference.

break

I am not predicting here which side the move will come but can only request “do not fight the tape, take the loss if caught on wrong side or even better reverse the trade, those patient will not take a position here and wait for market to show where it wishes to go”.

Among Banks, SBI is peaking my interest. I am bullish on the stock, can see it doing around 270 kind of levels. Here is a chart (daily) for reference : It is rejecting 250 levels strongly and 10EMA is showing stabilizing of supply.

SBI

If SBI will rally, BOB shall follow it too, can do 125 as that remains the last demand zone highlighted in chart (Daily)

bob

Among Cement Stocks, I have personal long bets on ACC and Ambuja Cement via call options, do see it performing well on the long side.

Talking about individual stocks, GAIL should give a breakout next week, a very clean chart, it’s just beautiful to see.

gailll

ITC is another stock that looks bullish here. Here is a weekly chart, every-time it comes under 10EMA, gives a good percent move, that has happened 2 times since the fall witnessed a year ago, it’s forming a good base.

itccs

I don’t short and will be sticking to my domain, one more stock on my watch for a long side play would be Container Corporation. Here is a daily chart with 200EMA setting itself up for a bullish move.

concor

Lastly IDBI Bank would be on radar, now as it reversing from a downtrend, I won’t be expecting a big move here so won’t be buying options as that should have been done at Rs 50 but you see I think it gave a bear trap at 47Rs and is a good investment call.

idbi

My friendly advice would be to take a look at PSU Banks, we have different varieties of candies available in the store, I am not a fundamental guy so won’t be cherry picking which ones for long term but seeing some strength in price action lately and think this sector might do well in coming days.

I know I did skip talking about IT, Pharma, Auto stocks but I didn’t find anything worthy enough to share looking at their charts and market keeps on changing, edge that I had is not there anymore so won’t be forcing trades unless seen otherwise.

Keep sizing in check and see you on the other side of field next week. Peace 🙂

 

 

 

 

 

 

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