Nifty likely to touch 18,000 in immediate term: Analysts

RAHUL SHARMA
Head Technical and Derivatives Research, JM Financial Services

Will the Nifty touch 18000 in the immediate term?

Technically, Nifty is making “higher-high higher-low” structure on all major time frames and not showing any major sign of slowing down. It is holding well above the 200% reciprocal retracement level of the previous fall from 12430 to 7511, which is placed at 17350. Momentum oscillator RSI (relative strength indicator) is also moving in an overbought zone from quite some time but prices are not ready to give up the momentum.

What should investors do?

Bank Nifty has shifted gears after a long consolidation, the banking index finally gave a breakout above 37200. Till the time it holds above 37000 mark, view remains positive for an up move towards 39000 and then 40000 zone. On other sectoral indices front, Nifty Metal index has taken resistance around its previous highs and started its southward journey. It is expected to correct further towards 5200 levels in coming days. Will ITC continue its run? ITC has broken out of consolidation of last 8 months however it is yet to take out its crucial resistance of 239 which happens to be its Feb 21 high. Volumes were pretty good on breakout day but follow up buying above 239 is a must in this week which can prepare the stock for higher trajectory upto 255/260 levels. 220 should act as a crucial support from here.

ABHILASH PAGARIA
Senior VP, Edelweiss Alternative Research

Will the Nifty touch 18000 in the immediate term?

The markets are in strong uptrend, but due to the temporary extreme overbought reading and Market Open Int at INR 2.3tn (historic high levels), the bulls may prefer to take a cautious stance near the 17,800 level. In the September expiry we may trade in a broad range of 17,200 to 17,850.

What should investors do?

The traders can look to initiate Bearish Seagull Option Strategy for Sep 23,2021 – Buy 17,500 Put, Sell 17,100 Put and Sell 17,800 Call. As per our Quant models and even DXY technical Breakout , Metals Sector will be sell on rally and I.T. would continue the upward momentum. On multiple parameters Mindtree and Mphasis feature as a long for 2-3months holding with 20% upside. Will ITC continue its run? I will avoid suggesting long until stock settles above 238 with higher volume and delivery vs 20D Avg.

RAJESH PALVIYA
Head-Technicals and Derivatives, Axis Securities

Will the Nifty touch 18000 in the immediate term?

On the weekly chart the Nifty has formed a long bullish candle forming higher high-low compared to previous week and has closed above previous week’s high indicating positive bias. The index is moving in a higher top and higher bottom formation on the weekly chart indicating positive bias. For the week, we expect Nifty to trade in the range of 17400-18000 with a positive bias.

What should investors do?

We expect IT, FMCG, chemical, banking and financial stocks to do well in the near term. One can focus on HDFC Bank, Kotak Bank , HCL Technologies,Tech Mahindra, Deepak Nitrite, Dabur,Voltas , Hero MotoCorp, Indigo for the coming week.The strategy which we are suggesting for this weekly expiry dated 23rd September is a Bullish strategy called as call ladder, which involves buying of one lot of Nifty 17,600 Call at Rs 103 and selling of one lot each of 17,700 Call at Rs 62 and one lot of 17,800 Call at Rs 35.

Will ITC continue its run?

ITC has resistance in the Rs 230-240 range. Option chain data indicates that major call option writing activity has been witnessed at 240 and 235 strikes in the last week and these levels are likely to act as a resistance.