Since the day’s high of 17,919, the Nifty has been trading in profit and falling more than 130 points to 17,780.
Near-term support for the Nifty is estimated at around 17,500 levels, which happens to be a 34-day EMA. Resistance for Nifty is seen at the 18,100 level. Over the past 6 weeks, the Nifty has been in a tight consolidation zone. A breakout of the 17,500-18,100 range would give directional movement in the Nifty.
Purchase range: Rs 418.5 – Rs 405
Objectives: Rs 450; Rs478
Stop Loss: Rs 400
The stock price broke out from the descending trendline on the monthly charts. The share price also broke above the double top resistance of Rs 410 with volumes rising.
The defense sector has outperformed in recent months. Additionally, the stock sits above all major moving averages, indicating a bullish trend across all timeframes. Indicators and oscillators like RSI and MACD have shown strength in the current uptrend.
Purchase range: Rs 641 – Rs 615
Objective: Rs 700
Stop Loss: Rs 610
The stock broke out of the “Flag” pattern on the weekly chart. The breakout in price is accompanied by an increase in volumes and the stock also broke out of the consolidation, which held for the previous 3 weeks.
Additionally, the stock is placed above its 20, 50, 100, and 200 DMA, indicating a bullish trend across all timeframes. Indicators and oscillators like DMI and MACD have shown strength in the current uptrend.
(Vinay Rajani, Senior Technical and Derivative Research Analyst at HDFC Securities. Opinions expressed are personal).