Nifty outlookThe occurrence of “Bullish Harami” in the Nifty post sharp downside in the previous trading session indicates subsiding selling pressure. Earlier occurrences of “Bullish Engulfing” & “Bullish Hammer” indicates bears are unable to breach below support levels placed around 10,775 (100 WEMA). With most oscillators recovering from their respective oversold zones, further short covering move targeting 11,180 & 11,230 is a likely scenario. Unless the index breaches below 100 WEMA (10,775), the possibility of unlocking short covering move persists. However, only a move surpassing 200 DEMA (11,270) would lead to sustainable upside momentum in coming sessions. Short-term traders can initiate longs with a stop placed below recent swing low of 10,782 for a continuation of short covering move targeting 11,180 & 11,230 in coming sessions.
Stock: JSW STEEL
Reco : BUY
CMP: Rs 227.75
The stock continued its recovery from 52-week lows, closing above its recent gap resistance placed around 223 levels. Daily RSI picked up momentum after surpassing its signal line, as expected. Further short covering can be expected in the stock above 230 levels as it bears highest call OI. The stock can be bought with a stop placed below Rs 224.20 price confluence support zone for short covering move targeting 242 levels in coming sessions.
Stock: AXIS BANK
CMP: Rs 663.20
The occurrence of “Bullish Harami” formation around fresh 6-month low suggests short covering bounce as the stock tested its January swing lows around 650 levels. Prevailing bullish divergence on Daily RSI along with occurrence of bullish formation suggests the stock might witness further short covering move targeting its gap resistance levels around 694 in coming sessions. The stock can be bought with a stop placed below 650 price confluence support levels for a test of 694 gap resistance levels in coming sessions.
Disclaimer: Analyst may or may not hold positions in one or more stocks