By Nagaraj Shetti
After showing a sustainable upmove in the last three sessions, Nifty shifted into a consolidation on Wednesday amidst volatility and closed the day higher by 10 points. A small red candle was formed on the daily chart with minor upper and lower shadows. Technically, this market action indicates a formation of a high wave type candle pattern at the highs and this reflects ongoing volatility in the market. Normally, such high wave type candle formation after a reasonable upmove or at the hurdle sometimes results in an impending reversal of trend after the confirmation.
Having placed near the crucial resistance, the Nifty was unable to gather strength to witness a decisive upside breakout. A bullish chart pattern like higher highs and lows is intact on the daily chart and any dips from here could be a buying opportunity.
Conclusion: The near-term trend of Nifty continues to be positive. Having not been able to surpass the resistance zone sharply above 24500 levels, there is a possibility of some more consolidation or minor dip in the next 1-2 sessions before showing the next round of upmove. Immediate support is at 24300 levels.
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Stock Picks:
Buy Mazgaon Dock Shipbuilders – (Current market price Rs 4,880)
The weekly timeframe chart of Mazgaon Dock Shipbuilders witnessed a sustainable upmove in the last couple of weeks. The stock price has witnessed a sharp upside breakout of a downsloping trend line around Rs 4,650-4,700 levels this week, as per the weekly chart. The present chart pattern indicates a crucial reversal of the downward correction of a few months and one may expect a continuation of upside momentum in the near term. Volume has started to expand during the upside breakout in the stock price and RSI shows a positive indication.
Buying can be initiated in Mazagon Dock Shipyard at the current market price of Rs 4,880,
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