Nifty 50: Analyst Recommends 'Buy on Dips'
Market analyst Varun N Joshi, founder of Nirivantes Research, has advised traders to adopt a "buy on dips" strategy for the benchmark Nifty 50 index. Speaking to Business Today Television, Joshi indicated that the Nifty has found support around the 22,350 level, which he considers crucial for short-term trading.
For traders looking to enter the market, Joshi identified the 22,450-22,500 range as a potential buying zone, particularly if the Nifty approaches 22,500 in upcoming sessions. He stressed the importance of maintaining a strict stop-loss at 22,350 on a closing basis to mitigate risk.
Conversely, Joshi pinpointed the 22,750-22,800 range as a key resistance area where selling pressure could emerge. This zone is considered ideal for traders contemplating short positions, with a suggested stop-loss at 23,050.
Nifty Bank Under Scrutiny Ahead of RBI Policy
Regarding the Nifty Bank index, Joshi cautioned that rate-sensitive stocks might experience underperformance or consolidation leading up to the Reserve Bank of India's (RBI) monetary policy decision. While the market appears to be pricing in a 25-basis-point move, Joshi highlighted that the most significant factor would be the RBI and government's commentary.
"If the stance remains more hawkish and the possibility of a rate hike increases, there could be selling in Nifty Bank, which could ultimately lead to a breakdown in the Nifty as well," Joshi stated. He advised traders to exercise caution, wait for clarity, and avoid taking overly aggressive positions during this period of uncertainty.
Individual Stocks Highlighted by Joshi
Beyond the broader market, Varun N Joshi singled out two specific stocks that traders should monitor closely: Aequs Ltd and Aditya Vision Ltd.
Aequs Ltd: Breakout Confirmed
Joshi noted that Aequs Ltd has been consolidating within the Rs 280-284 range and recently saw a nearly 4 percent gain. He explained that Aequs had previously attempted to break out of the Rs 270-274 zone three times without success. However, the stock has now received breakout confirmation after closing above Rs 270 for three consecutive sessions.
For Aequs, Joshi suggested a stop-loss at Rs 245 and set a target of Rs 325, indicating potential further upside following the confirmed breakout.
Aditya Vision Ltd (AVL): Bullish Signs Emerge
Aditya Vision Ltd (AVL) also caught Joshi's attention. He observed that AVL had formed a bullish engulfing pattern on its daily chart, supported by robust trading volume. The stock successfully bounced from a key support level around Rs 570.
According to Joshi, this indicates a strong base formation for Aditya Vision, suggesting the stock could potentially advance towards the Rs 640 mark in the near term.