Niftyโฃ in Consolidation Phase, faces Key Levels at 25,700-26,100: analyst Rajani
Mumbai – October 28, 2024 – The Nifty index โขis currently experiencing a โขconsolidation phase, trading within a range of 25,700 to 26,100, โaccording to analyst Vinay Rajani.The index fell over 200 points โfrom its day’s high today, with a highโค of 26,041, following a weak close last week markedโฃ by a “shooting star” candlestickโข patternโ at 26,104.
Rajani noted that profit booking and aโ weakeningโ rupee areโค contributing toโค investor caution. “The other โขfactor which is cautious is theโค movement of the rupee against the dollar. So, rupee has startedโฃ depreciating โคagainst the dollar again, so that is a concern.Yesterdayโข we sawโ 40โ paisa depreciation in the rupee, so that has been a โleading indicator in โrecent โpast and we should track it closely,” he saeid.
He โidentifies 26,104 -โค last week’s high – as a โขkey resistance level for the Nifty, โฃwhile 25,700 will act โas immediate support. Rajani expects the marketโ toโ remain โlargely โsideways until the index breaks decisively above 26,104 โor below 25,700. “Unless we seeโข a level above 26,104โฆwe should remain cautious and stock specific, โฃsector specific because of the result season weโข may โขseeโ some movement onโ the either โฃside,” he explained.
Despite the overall consolidation,โข Rajani highlighted the outperformance of โmetal andโค PSU bank โstocks. “As we have been discussing metal stocks have been doingโค good, PSU banks have been doing โขgood. So โyes, we have โtoโ trade in the outperforming stocksโฃ and โsectors,”โฃ heโข stated.
rajani’s Top Picks:
The analyst โexpressed bullishness on the metals sector and select Non-Banking Financial โฃCompanies โฃ(NBFCs),specifically recommendingโค Tata โSteel and IIFL.
he suggests โa โฃlong position on Tata Steel around โน180-โน180.5, with a stop loss at โน177 and a short-term target of โน187, citingโข a “convincing” โคtechnical setup andโค strength building in steel stocks. “Tata Steel is one of the โstock which is today’s gainers inโค the Nifty also and looks like โthat the โขsteel stocks are headed higher from โhere,” heโค noted.
For IIFL,Rajani recommends a long position โaround โน515-โน516,withโ a stop loss at โโน505 and a target of โน540 within the โฃnext few sessions,as the stock has brokenโข out from a โคconsolidation phase.
Rajani advisesโฃ traders to remain cautious, focus on outperforming sectors, and maintain strict stop losses until the Nifty โestablishesโ a clear directional trend.