Momentum could take Nifty to 18,000: Analysts

Momentum could take Nifty to 18,000: Analysts – Mail Bonus


The underlying market momentum is very bullish and Nifty is expected to touch 18,000 level again this week, according to technical experts. They say the benchmark is expected to reach an all-time high if it stays above 18,000. Astral, , , HAL, , and SRF are some of the mid-caps showing bullish trends, according to experts.


Where is the Nifty headed this week?
The Nifty finished higher for the week, up 1.7%, and appeared to have broken out of the ‘Descending Breading Wedge’ pattern it has been trading in since October 21. Last month, the index also tested the psychological 18,000 mark but witnessed some correction. The faster fall retracement shows the strength and willingness of the index to go beyond the 18,000 level. Barring intraday weakness, the index is likely to cross the 18,000 level and a sustained close above the same is likely to take the index higher towards all-time highs.

What should investors do?

Strength in the market is now visible in sectors such as banking, finance and consumption. Mid- and smallcaps have already broken through against the Nifty 50, and the strength is likely to continue there. In the mid-caps, smaller pockets such as defenses (HAL, BDL), specialty chemicals (Navin Fluorine, SRF) and engineering products (ABB, ) are showing strength; while weaker sectors such as IT (, Affle) and metals (, ) have begun to show strength selectively. The broader sense remains “buying on dips”




Where is the Nifty headed this week?
Nifty’s falling resistance trend from October 2021 high is at critical resistance around 18,000. Expect the market to rise initially towards 18,000 and then 18,160 and 18,350 levels. However, on the hills, 17,500 is the level to watch out for. Break and sustain below 17,500, markets could see a correction towards 17,200 and then towards 16,900 levels. This week there are a number of data such as UK GDP, US and UK inflation, US retail sales, Eurozone CPI and China’s industrial production, which would weigh on the markets and keep them volatile.

What should investors do?

The financial sector is at the forefront of the current boom and has given a fresh break. Investors can look at stocks like

and SBI leading the pack. IT package, a laggard, has received support from the previous low area. and TCS can be viewed for rebound rally. has given a new break after 18 months of consolidation that can be entered at current levels and at any dip. Vinati Organics has been gaining strength in specialty chemicals stocks for over a year and is now starting a new upswing.



Where is the Nifty headed this week?

The underlying market momentum is very bullish and it is highly recommended to avoid shorts. Even if we see profit taking at higher levels which must be used to make fresh purchases as long as Nifty is above 17,350 levels. In the next two quarters, we can see Mojo’s midgets return and they may outperform the heavyweights.

What should investors do?

Based on our own quant models, we have been pushing the technology basket from a two-month horizon; participants can buy


IT ETF with 8% target. Looking at the mid-cap equity market, we continue to like Astral, Indian Hotels and Max Healthcare promising global index adoption rebalancing trades. These stocks also have strong fundamental support. These names can be added with a three-month horizon and an expectation of 30%, with a stop loss of 10%. With regard to one year worth of play, small units can be purchased. In terms of media trade valuation, we like Zee Long and PVR Short trades for 5-7 weeks.

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