Home Correction trading Day Trading Guide: 2 action ideas for the next session

Day Trading Guide: 2 action ideas for the next session

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NEW DELHI: Markets rebounded smartly on Thursday after a weak morning session. The Nifty eventually gained 144.35 points or 0.9% to close at 16,170.15. Major equity indices like the BSE Mid Cap Index gained more, outperforming the Sensex/Nifty. The breadth of the market was positive for BSE/ESN.

Zooming in on the 15 minute chart, we see that the Nifty has found support around the 15,900 levels and rallied strongly from there. In the process, the index moved above the 20 and 50 period MA. This indicates near-term strength, said Subash Gangadharan, Principal Technical and Derivative Analyst,

Securities.

The Nifty daily timeframe indicates that the index has formed a hammer pattern. This is considered a bullish reversal pattern after a correction. Traders will now need to watch if the Nifty can break through the immediate resistances at 16,263-16,415 for the bulls to take control, the analyst quoted above said. Supports are now at 16,006-15,903.



“We recommend a stock-specific approach and recommend buying stocks in sectors showing relative strength. While we remain open to a very short-term bounce, we must remember that the middle trend remains down. The bears would gain more control once the recent mid-low of 15,735 is breached,” Gangadharan said.

Here are two analyst recommendations for Friday:

Kotak Mahindra Bank

To buy Range: Rs 1,900 -1,920

stop loss: Rs 1,850

Targets: Rs 2,050/2,100

Strength index relative to confluence. Good roll with a better base. The IVs smooth out for the next set. This indicates the possibility of directional movement. Strike OTM CE at maximum congestion Rs 2000. Strike OTM PE at maximum concentration Rs 1800.

Analyst: Kruti Shah, Equirus

Navin Fluor

Sale Range: Rs 3,620 – 3,660

stop loss: Rs 3,800

Targets: Rs 3,200/3,100

On a monthly timeframe, the stock is trading near a repeating supply zone. It reacted strongly against the previous supply zone, forming several highs above Rs 3,800. The stock is weakening below 3,600, suggesting that the opportunity is creating a short position.

Analyst: Kruti Shah, Equirus

(Disclaimer: The recommendations, suggestions, views and opinions given by the experts belong to them. These do not represent the views of Economic Times)