Nifty Index Chart Analysis

After ending the financial year 2016-17 on a prosperous note, the fireworks continued on Dalal Street as benchmark indices started the new financial year with a bang. Nifty registered the all-time high level of 9273.90 and the BSE Sensex touched the magical mark of 30,000 for the first time after March 2015, a gap of almost two years. The week gone by was an eventful one as a number events took place during the week. The major event of the week was the RBI monetary policy meet. The RBI under governor Urjit Patel kept the repo rate unchanged, but raised the reverse repo rate by 25 basis points from 5.75 per cent to 6 per cent. However, early next day, the news of the US missile strikes against Syria sent shock waves through the equity markets and Nifty ended the week with a marginal gain of 0.27 per cent on week-on-week basis.

Nifty has formed a ‘shooting star' like candlestick pattern on the weekly time frame. The 'shooting star' is a single candle bearish reversal pattern developing after an up-leg. On the daily time frame on April 7, 2017, Nifty formed a negative candle. There is also formation of negative divergence in 14-period RSI. Now, going forward, the zone of 9130-9160 is a crucial support zone for the Nifty. Firstly, the level of 9160 is important as defined by the 13-day EMA and the 13-day EMA has acted as a crucial support level in the entire upmove that started from the level of 7893. Secondly, we get a rising trendline support by joining the lows of 8713, 8904 and 9024 and this trendline support comes near the 9130 level. If the support area of 9130-9160 is breached,the next major support level is placed in the region of 8990-9000. On the upside, the immediate hurdle for Nifty is placed around levels of 9230-9245 and if it stays above 9230-9245, it is likely to scale up to the level of 9280. Fresh leg of upmove is likely only if Nifty sustains above the level of 9280 successfully and the next resistance would come in around the level of 9380.

The next big trigger for the domestic markets will be the quarterly results and all eyes will be on the IT heavyweight Infosys which will be announcing its result on April 13, 2017.

The level of 8990-9000 is a major support for Nifty and, on the upside, the level of 9280 may act as a hurdle for the bulls.

STOCK RECOMMENDATIONS

GATEWAY DISTRIPARKS

BSE Code : 532622
Buy CMP : Rs.274.80
TGT 1 : Rs.310 TGT 2 : Rs.342
SL: Rs.242 (CLS)

The stock of Gateway Distriparks is currently trading at Rs.274.80. Its 52-week high/low stand at Rs.325.65/Rs.210.35 which were made on June 10, 2016 and November 9, 2016. Considering the weekly frame, the stock formed a strong base around levels of Rs.201-206. After registering high of Rs.347.33 in January 2016, the stock entered into a corrective phase and took support around the level of Rs.201. At present, the stock has witnessed breakout of a triangle-like pattern on the weekly time scale, along with rise in volumes, which is positive for the stock. On the weekly time frame, the 14-period RSI is hovering around 59.50 level which is highest reading in the last one-and-half year. Considering the breakout of triangle pattern, we recommend Buy in the stock for a target of Rs.300, followed by a medium-term target of Rs.310. We maintain a stop loss of Rs.242.

MRPL

BSE Code : 500109
Buy CMP : Rs.113.30
TGT 1 : Rs.124 TGT 2 : Rs.127
SL: Rs.110 (CLS)

The stock of Mangalore Refinery and Petrochemicals (MRPL) is currently trading at Rs.113.30. Its 52-week high and low stand at Rs.115.95 and Rs.63, respectively, made on January 10, 2017 and June 24, 2016. Considering the daily time frame, the stock after registering high of Rs.115.95 took support around the level of Rs.97.30, which coincides with 61.8 per cent retracement for entire rise from the level of Rs.85.60 to the high of Rs.115.95. At present, the stock has witnessed breakout along with decent volumes. The 14-daily period RSI is trending and trading above the level of 60.

Based on the above rationale, further upside is possible in the stock and it can test levels of Rs.124-127 in the short-medium term. The stop loss can be maintained around the level of Rs.100.