Stock Market Outlook for Wednesday
The Nifty index opened on a negative note and failed to cross 24,150 in the first hour and faced strong rejection from the higher levels. The index remained under sustained selling pressure throughout the session and broke all its immediate support levels. Lack of buying interest at lower levels gave strength to the bears. It formed a big bearish candle on the daily frame and closed with losses of around 280 points, indicating rejection from higher resistance zones and a shift in the near term sentiment. Now if it holds below 23,850 weakness could be seen towards 23,700 then 23,600 zones while on the upside hurdles have shifted lower to 23,950 then 24,100 zones. On option front, Maximum Call OI is at 24,200 then 24,000 strike while Maximum Put OI is at 24,000 then 23,900 strike. Call writing is seen at 23,900 then 24,000 strike while Put writing is seen at 24,000 then 23,900 strike. Option data suggests a broader trading range in between 23,400 to 24,300 zones while an immediate range between 23,600 to 24,100 levels. Bank Nifty index opened on a flattish note near 57,900 zones and remained consolidative in the first half of the session. However it gave a range break down below 57,750 zones and drifted towards 57,100 levels in the latter part of the session to close with losses of around 750 points. It formed a Big Bearish candle on daily scale as selling pressure is seen at higher zones. Now till it holds below 57,250 zones some weakness could be seen towards 56,500 then 56,250 levels while on the upside hurdle is seen at 57,500 then 57,750 zones.
Stocks to buy
Zydus Life Current Market Price: ₹1,112 Stop Loss: ₹1,080 Target: ₹1,180 Zydus Life stock has bounced up from its 20-DEMA support zones and headed up with high traded volumes. The Stochastic indicator has exited its oversold zones confirming the up move. Bharat Forge Current Market Price: ₹2,152 Stop Loss: ₹2,085 Target: ₹2,280 Bharat Forge stock is in an overall uptrend and is respecting its 50-DEMA support zones with slight dips being bought into. The ADX line is rising which confirms the strength of the bullish trend. KOTAKBANK Current Market Price: ₹402 Stop Loss: ₹390 Target: ₹420 Kotak Bank stock has retested its breakout zones and has taken support at its 200 DEMA support zones. The RSI indicator is positively placed which has bullish implications. (Disclaimer: This article is by Chandan Taparia, head derivatives & technicals, wealth management, Motilal Oswal Financial Services. Views expressed are his own.) (Disclosure: Entities controlled by the Kotak family have a significant holding in Business Standard Pvt. Ltd.)
