17800 unlikely on Muhurat Trading Day; Nestle India, Eicher Motors top largecap picks: Gaurav Ratnaparkhi

“17,800 on Muhurat Trading Day is unlikely. As discussed, the index has reached the 61.8% retracement of the September fall & the daily upper Bollinger Band, which is a crucial resistance zone," says Gaurav Ratnaparkhi, Head - Technical Research, Sharekhan by BNP Paribas.

In an interview with ETMarkets, Ratnaparkhi, said: “On the long side, we are recommending Nestle India & Eicher Motors from the large cap space whereas Aegis logistics & Deepak Fertilizers are our midcap picks” Edited excerpts:

What a week for Indian markets ahead of Diwali. Benchmark indices rose more than 2%. What led to the price action?
The Nifty50 was forming a base near the key weekly moving averages for the last three weeks. It had also taken support near the 200-DMA.

The level of 17,000 acted as a crucial support. From there the index took a leap in the week gone by. It did 61.8% retracement of the entire September decline & tapped at the daily upper Bollinger Band

We are heading for a truncated week. Where do you see nifty heading in the coming week? Do you see 17800 on Muhurat Trading Day?
1,7800 on Muhurat Trading Day is unlikely. As discussed, the index has reached the 61.8% retracement of the September fall & the daily upper Bollinger Band, which is a crucial resistance zone.

Despite multiple attempts in the last week, the Nifty couldn’t sustain above 17600. Thus, the index is preparing for a downward move again. It can tumble down towards its key daily moving averages, which are near 17300-17200

In terms of sectors, banks, PSU stocks rose more than 3%. What led to the price action?
As you rightly pointed out, Banks & some of the PSU stocks did well in the last week; especially the PSU Banking space had a stunning performance.

The Nifty PSU Bank index broke out from an inside bar pattern on the weekly chart & had a strong follow-through on the upside. The overall structure shows that this space can continue to witness traction in the next couple of weeks as well.

What are your top Muhurat Trading Day picks for the short term (3-4 weeks)
We at Sharekhan Technical Research, have come up with the Muhurat Trading Picks report. It’s a basket of 6 solid trading ideas, which is a mix of long & short trading recommendations.

On the long side, we are recommending Nestle India & Eicher Motors from the large-cap space whereas Aegis logistics & Deepak Fertilizers are our midcap picks.

For the short side trade, we have identified Chola Finance November Future & Crompton November Future.

What is your take on the rupee? Do you see further weakness in the coming week?
USDINR has been surpassing multiple hurdles on the way up. At the beginning of October, it moved out of the upper end of a rising channel, formed a consolidation above the upper channel line & is now looking to extend higher. The currency pair is likely to test the level of 84 in the coming weeks.

One trading advice you would want to give to traders on Muhurat Trading for Samvat 2079.
It is important for traders to understand the significance of longevity when it comes to trading. One has to be in the game, in order to win the game.

To achieve longevity, one should have a disciplined approach with proper money management

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