After rebounding from the 200-Day Moving Average support last Friday, Nifty extended this recovery this week by climbing 3.4% and recouping most of the previous week's losses. This was the best weekly gain for the benchmark in nearly four months. The rally was broad based as all the sectoral indices closed higher. Nifty Bank was the star performed this time, which climbed 6% and snap 4-week losing streak. Nifty mid-cap and small-cap indices rose 3.8% and 3.6% respectively.
After this week's rebound, Nifty is very close to the resistance level we had talked about last week. Downward sloping trendline adjoining tops made on 31st August and 16th September, which also coincides with the 67% retracement level of the 11794-10790 fall, is placed around 11460, and would work as the immediate hurdle. If this hurdle is taken out, 11618, the top made in September, would be the next target. On the way down, 11220 is the immediate support on the hourly chart. If that breaks, 11100 and 11000 would be subsequent supports to eye.
Banknifty too is close to near term resistance after this week's mammoth upmove. 34-DMA for the benchmark is placed around 22425 and is the immediate hurdle to eye. If this level is taken out, 22800 would be the next target.
ACTION CONSTRUCTION EQUIPMENT (CMP: 72.30): The stock on Friday surged 8% with volumes which were nearly 3-times 10-day average volume. The stocks has also broken out of a symmetric triangle formation on its daily chart. The stock can be bought at current rate for the target of 83. The stop-loss should be placed at 66.45.
PIDILITE (CMP: 1463): The stock, after making a top of 1517 in mid-September, saw a correction which took it to its 200-DMA. The stock has resumed its upward journey and has broken out of an ascending triangle formation on it's hourly chart on Friday. The stock can be bought at current rate for the target of 1520. The stop-loss should be placed at 1428.
INDOCO REMEDIES (CMP: 273): The stock surged 6.5% on Friday with good volumes and is very close to breakout on its hourly chart. The stock can be bought after 277.70, the top made on Friday, is crossed, for the target of 317. The stop-loss should be placed at 254.
TVS MOTORS (CMP: 480): The stock broke out from a channel formation on its daily chart this week after a consolidation of nearly a month. The stock has also crossed a downward sloping trendline resistance on its monthly chart. The stock can be bought at current rate for the target of 521. The stop-loss should be placed at 448.
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