Benchmark equity indices snapped their four-week gaining streak and ended the passing week off their all-time closing high levels. Initially, the Nifty index registered a new lifetime high near 15,900 and then tumbled down to 15,450.
However, a smart recovery during the fag end of the session on Friday helped the index to close much near to 15,700 zone. Eventually, the index concluded the week with a marginal loss of -0.73%. The low of 15,450 would now remain a sheet anchor for the markets. A decisive move below the same would apply brakes to the overall trend.
On the contrary, till the time this support is held there are chances of another high. However, from here on we have a cautious stance on the market and would advise traders to remain extremely selective while going long. With regards to Nifty Bank, it sneaked below the 34,000 mark but somehow managed to close higher. Hence, the support for banking index is now at the weekly low of 33,900. This could be a tough nut to crack for the bears since 34,000 is the confluence of too many supports on the technical front.
On the upside, a move above 34,800 might bring the financials again into the trader’s radar. For stock-specific investors, here are two stocks for next week.
SBI Cards | Buy | Stop loss: Rs 955 | Target price: Rs 1,100
The counter found support at the rising trend line on the daily chart and the uptrend is still intact. We are also witnessing a hammer kind of formation on a daily scale. The stock can be bought with a time frame of 3-5 weeks.
Sun Pharma | Buy | Stop loss: Rs 648 | Target price: Rs 704
Looking at the current volatility, Sun Pharma could be a safe defensive bet. The stock has turned from decisive support.
(The writer is AVP – technical research at Anand Rathi Shares and Stock Brokers. Views expressed are personal)
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