The next targets for the Nifty50 to watch out for would be 20,500-21,000 in the short term, considering the strong momentum sustained through the last seven sessions with participation from bank and IT stocks
The Nifty50 finally scaled the much-awaited psychological level of 20,000 points on September 11 with most of the sectors joining the rally after the G20 Summit boosted the confidence of market participants.
The next target for the index to watch out for would be 20,500-21,000 level in the short term, considering the strong momentum sustained through the last seven sessions with participation by banks and IT stocks, while support is expected to be at the 19,900-19,800 levels, experts said.
The Nifty50 jumped 176 points to 19,996 on Monday, taking the total seven-day gains to 3.85 percent, while the broader markets remained on the buyers’ radar as the Nifty Midcap 100 and Smallcap 100 indices rallied over a percent each on Monday.
“The Nifty has now reached to the uncharted territory. The band of 19,800-19,900 now becomes the strong support for the Nifty in the short term,” Vinay Rajani, CMT, senior technical and derivative analyst at HDFC Securities.
As far as the upside target is concerned, he feels the index is now headed for the level of 20,924, which happens to be the 100 percent Fibonacci extension resistance of the entire swing seen from June 2022 (15,183) bottom to December 2022 (18,887) top, and from December 2022 (18,887) top to March 2023 bottom (16,828).
Breadth of the market is very strong as more than 91 percent of the stocks are trading above their 200 DMA in the NSE500 index. This reading is obviously overbought, he said.
Rahul Sharma, Director, Head- Technical & Derivative Research at JM Financial Services said the good thing was that the new leadership was coming from IT, capital goods and PSEs. BFSI, which remained pressured for some time, is also back in the positive territory.
The Nifty50, therefore, seems to be on track to hit 20,432 this month and 21,000 by Diwali.
Let’s take a look at the top 10 trading ideas by experts for the next three-four weeks. Returns are based on the September 11 closing prices:
