Nifty fell for the third consecutive session to close at 22,302. Nity lost 0.62 per cent today but managed to close above its 50 days EMA support placed at 22240. From the all-time high of 22,794, Nifty has witnessed a correction of more than 550 points in the span of three trading sessions.
Below 22,240, Nifty could slide down to 22,166, which happens to be 61.8 per cent retracement of the entire rally seen from 21,777 to 22,794.
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On the higher side band of 22,500-22,600 could offer a resistance. Nifty Smallcap and Microcap indices have started underperforming and look relatively weak on the chart. Traders should remain cautious in those segments.
Stock has been consolidating in the narrow range for the last 6 sessions. Primary trend of the stock has been bullish as it has been forming higher tops and higher bottoms. Stock is placed above all important moving averages, indicating bullish trend on all time frames. Indicators and oscillators have been showing strength in the current uptrend.
Buy Tech Mahindra(1,293): | Target Rs. 1380 | Stop-loss Rs 1,215
On 26th April, Stock broke out from the downward sloping trend line on the daily chart. Price rise was accompanied by a rise in volumes. Post breakout, stock witnessed correction and reached a gap support on the daily chart. After taking support in the gap, sock summarized its primary uptrend. Indicators and oscillators have turned bullish on the daily chart.
(Disclaimer: Vinay Rajani is CMT (Senior Technical and Derivative Research Analyst) at HDFC Securities. Views expressed are personal. He doesn’t hold any position in the above mentioned stocks.)
