By Shrikant Chouhan
Technically, at present the market place is following the pattern of the rally in between 2001 to 2008. It could be 10 occasions in the next 7 to 8 years. The Nifty was at 7500 throughout Covid19 crisis and the Sensex was at 25700. Nifty has the prospective to move up to 75,000 and Sensex to 2,57,000 points. In the next 3-6 months, we anticipate the Nifty to attain 15,500 and Sensex at 53,000 levels.
During the pandemic (2020), markets fell to intense worry levels across the globe. Now the time has come for the markets to move to the intense “Greedy levels”. The “sectoral rotational activity” has began which was missing in between 2008 to 2020 FIIs are investing considerably considering the fact that June 2020 which would help the rise in rupee. Cement stocks did incredibly properly, which had by no means occurred in the final 10 years, indicating that core economy information is either enhancing or going to enhance.
Between 1992 to 2001, Sensex moved from 2000 (lowest) to 6000 (highest) levels, which posted decent returns, nonetheless, the rally was absolutely gradual and extremely volatile. It was the toughest job for each participant (Fund Managers to Retail) to capture key moves.
However, in between 2001 to 2008 it was flourishing for absolutely everyone. Every person and corporate produced large income as the rally was constant and much less volatile. BSE Sensex moved from 2,000 to 20,000 (10 occasions). While Nifty 50 raced from 850 to 6350 (8 occasions) levels. Similarly, from 2008 to 2020, the Nifty 50 rose from 2250 to 12000 (6 occasions) levels and Sensex from 7700 to 42000 (6 occasions) levels. It was however once again gradual and extremely volatile. It was the toughest job for each market place participant to gauge the mood.
Based on the above correlation our stance, one particular really should purchase on each key dips. Support for the market place exists at 14000 and 13000 levels.
AMBUJA CEMENTS (Invest in): The stock is forming larger top rated larger bottom series on a weekly and month-to-month basis. It has not too long ago broken consolidation triangle formation at 225 and recovered back sharply. Technically, the stock is prepared to surpass the level of 291.50, which is the all-time highest level for the stock. Buy in tranches with a quit loss at 225. On the larger side, we could see the levels of 290 and 300.
JINDAL STEEL & Energy (Invest in): The stock has formed and validated to the formation of a double bottom. Based on it we could see the levels of 350 on the minimum and 550 on the maximum side. The metal index 700 points away from the all-time highest levels, which it has formed in the year January 2018. We are of the view that the index is prepared to surpass the all-time highest levels and that would create more fuel in higher beta stocks like JSPL. Buy at existing levels and more on dips with a final quit loss at 270.
BHARTI AIRTEL (Invest in): The stock is in lengthy term break out. It has broken multiyear resistance at 500. Although the stock was down in the second half of the year it recovered back and regained the level of 500 plus. We are of the view that the stock is heading for 700 in the medium term. It is a purchase at existing and more on dips with a final quit loss at 530.
BALRAMPUR CHINI MILLS (Invest in): It has spent 14 year inside the trading variety of 202 and 29. Currently, the stock is trading at 183 levels and in the method of crossing the level of 202 primarily based on it is formation of rounding bottom on the month-to-month chart. Technically multiyear break out of the trading variety aids the stock to move additional larger. Even if we go by means of with stocks associated to agriculture activity, then we can notice that most of them have currently entered in the lengthy term breakout, which is positive for the stock. The tactic really should be to purchase at existing levels and more on dips up to 170 with a final quit loss at 160. On the larger side 200 and 225 appears achievable.
TATA MOTORS (Invest in): On a every day basis, the stock is in sturdy uptrend, whereas it is in the pullback mode on a month-to-month chart. It was at 605 levels in the year 2016 and went to 63.50 levels throughout the period of Covid19. After crossing the level of 200, we saw a vertical up move in the stock. It has provided a cost and volume primarily based breakout, which is substantial and along with positive news flow for the stock on a domestic and international basis. Even if we contemplate 50% retracement from the reduce levels then it could attain 330 levels. The tactic really should be to purchase at existing levels and more on dips to 225 levels in the anticipation of help to the electrical automobile business. Keep a quit loss at 200 for the very same.
(Shrikant Chouhan is Executive Vice President – Equity Technical Research at Kotak Securities. The views expressed are individual. Please seek the advice of your economic advisor just before investing)