ETMarkets Smart Talk: Wipro shares may be in for another consolidation: Anand James

Edited excerpts from an interview:

Given Nifty’s trajectory, do you think the index will keep hovering within the 17,000-17,300 range in the near term?
Clearly, a breakout is due, having traded in the vicinity of 200-day SMA for 13 days now. We are inclined to take a contrarian view in the week ahead, with the expectation of upsides which could see at least 17,428, the recent peak. This surmise is supported by a decline in volatility expectations as evidenced by the fall in VIX from 20 to 18. Incidentally, VIX also closed at the day’s low on Friday, despite Nifty erasing nearly 1 per cent from the day’s high.

However, this is the 2nd time in 7 days that a breach of the super trend failed to sustain. This amply illustrates the underlying weakness, but we would entertain thoughts of 16,400-300 only if VIX reclaims 20 again.

After good results, what are the charts looking like for and ?

may require a consolidation before the next leg up, while TCS appears ready to push higher.

Is it better to avoid Wipro?
On the face of it, a fresh break below the recent low, which has held since the latter of June, is a clear red signal. But, put in perspective, the stock has fallen almost double as other IT biggies, like TCS or Infy, from the 2021 peak. This, along with the current price of Rs 377 being in the proximity of 68% fibo of the 2020-2021 run, there is a case of value buying. However, with price action yet to paint any reversal signs, we may be in for yet another consolidation before the run-up begins. Deeper support is seen at Rs 282.

Why are realty stocks under pressure? Is it better to avoid them at this stage?
A seasonally dull quarter followed by prospects of higher interest rates kept the sector under pressure for a while now. However, incentives from governments like Maharashtra, as well as reports of a surge in housing sales in select cities, present a case of looking out for value buying in this beaten-down sector.

Which are the 3-4 stocks that would be on your watchlist for this week?
(CMP: Rs 138)
View: Buy

Target: Rs 145 – 150

Stop Loss: Rs 132

A Morning Star is in half formation in the daily charts, hinting at continuation of the reversal attempt. Also, the daily MACD forest has shown signs of exhaustion with volume breakout. We expect this bounce back to see 145-150 levels. Place stop loss below Rs 132 for longs.

Sequent (CMP: Rs 103)
View: Buy

Target: Rs 108 – 112

Stop Loss: Rs 98.5

An inside bar after a three day consecutive decline in daily charts is pointing towards a bounce back in the short term. We would play this reversal for a target of Rs 108-112 with a stop loss placed below Rs 98.5.

(CMP: Rs 1253)
View: Buy

Target: Rs 1300

Stop Loss: Rs 1227

An inside bar Doji in the daily time frame hints at a bounce back soon. Further, this bullish assumption is supported by exhaustion seen in MACD and above-average volume buildup. We expect this bounce back to see Rs 1300 soon. Keep a stop loss below Rs 1227 for longs.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)