Day trading guide: Market will continue to see sector-specific action

Amit Trivedi, YES Securities

Nifty remained choppy as after Tuesday’s recovery, it failed to sustain at higher levels in today’s trade. Inability to provide follow-up action on either side are typical characteristics of the consolidation phase, which usually creates a difficult environment from a trading perspective. Nifty’s on-going consolidation could continue as long as it sustains above 11,650, while sector-specific action is going to be the likely theme ahead.

Immediate trading band for the Bank Nifty is seen between 23,800-25,000 zones. It could keep revisiting the upper band as long as levels of 24,000 are decisively held.

On the sector front, auto was the only index which was relatively holding ground and stock-specific rally within this space is likely to continue.

Midcap100 and Smallcap 100 index have managed to outperform the benchmark index. However, positive follow-up through is required to attract some buying interest.

India Vix jumped 5 per cent to settle above levels of 23. Significant open interest additions are seen at call strikes ranging from 11,800 to 12,000, while on the flip side, 11,700 put holds second highest open interest base, suggesting immediate floor between 11,650-11,700 for Nifty in the coming session.

Future recommendation

Buy Siemens November future near Rs 1,280-1,285

• Stop loss: Rs 1,250
• Target: Rs 1,320
• Forming a series of ascending tops and bottoms, the stock is holding ground above its 50-day EMA. Snapping two sessions’ losing streak, bulls have regained momentum in the stock, suggesting that positive follow up could lift the stock above the Rs 1,300 mark.

Equity recommendation

Buy Adani Gas near Rs 200

• Stop loss: Rs 192
• Target: Rs 217
• Multi-week decline eventually found renewed buying interest near levels of 50 days EMA. Appearance of positive close post trend line breakout could mean resumption of prevailing uptrend.

(Amit Trivedi, CMT, is Technical Analyst - Institutional Equities, Yes Securities. Views are his own.)