The Nifty 50 has rebounded smartly from the lows of the preceding week and is now scaling fresh all-time highs. However, the Relative Strength Index (RSI) has nevertheless not enhanced for the index, stated Rahul Sharma, Director & Head – Research, JM Financial in an interview with Kshitij Bhargava of TheSpuzz Online. Further, he adds that Nifty could face a robust resistance close to all-time highs and believes that the FMCG space remains the finest bet for investors, provided the elevated levels of Nifty. The benchmark indices had corrected from the highs last week amid a international sell-off.
Do you nevertheless see a correction taking Nifty closer to 15,900?
The current bounce-back in the international markets have taken Nifty away from harm’s way as assistance of 16,400 remained intact on a closing basis. However, RSI has nevertheless not enhanced for Nifty as compared to the August 18 higher and we could see provide coming once more at larger levels. The very good point about yesterday’s move was an improvement in marketplace breadth which has helped Nifty record a close above 16,600 (a new ATH closing). The confirmation of correction will come if we break 16,400 decisively till then it is finest to stick to momentum counters for trading and investors are advised to take some income off the table as we inch larger.
If last week’s damaging trend has been reversed what level could the Nifty scale in the close to term?
We are approaching month-to-month expiry and month-to-month closing which ought to set the trend for a lot of sectors that have began to witness rotation. Since we are in uncharted territory it is finest to take one move at a time and maintain cease-losses on longs. Nifty could try to test the 16,700-16,800 zone on the upside which remains a robust resistance region as per choices information.
What levels ought to investors watch on the downside?
Below 16,400 the bearish move would get activated when once more.
What sectors appear eye-catching at this juncture?
FMCG appears the finest bet as of now provided the elevated levels in Nifty whereas IT could see very good trading momentum continue. We are searching for indicators of adhere to-up getting when identifying sectors.
Midcap and smallcap stocks jumped today, is the trend reversing for them and could we see them surge larger or is it as well early to say?
It’s a bit early I would say due to the fact they are due for a time correction. It is finest to stick to top quality names in Mid-caps and Small-caps and stay away from pre-empting bounce back trades right here.