The Indian stock market benchmark indices, Sensex and Nifty 50, are expected to extend rally and open higher on Friday amid mixed global market cues. The trends on Gift Nifty also signal a positive opening for the Indian stock market today.
On Thursday, the domestic equity market witnessed a sharp rally, with the benchmark Nifty 50 settling above the 25,000-mark.
The Sensex jumped 1,200.18 points or 1.48%, to close at 82,530.74, while the Nifty 50 ended 395.20 points, or 1.60%, higher at 25,062.10.
On the Nifty options front, Chandan Taparia, Head – Derivatives and Technicals, Wealth Management, MOFSL, said that the maximum Call OI (Open Interest) is at 25,500 then 25,100 strike while maximum Put OI is at 24,500 then 25,000 strike.
“Call writing is seen at 25,100 then 25,500 strike while Put writing is seen at 25,000 then 24,800 strike. Option data suggests a broader trading range in between 24,500 to 25,500 zones while an immediate range between 24,850 to 25,250 levels,” Taparia said.
Nifty 50 Outlook
Nifty 50 index witnessed a strong intraday rally of over 600 points from the day’s low near the 24,494 mark on May 15, and eventually crossed the psychological level of 25,000, closing with solid gains of nearly 400 points, showing strong bullish momentum.
“The rally was primarily triggered by short covering, especially after Nifty 50 sustained above the 24,800 zone which acted as a key breakout point. From there, bulls dominated the entire session. On the technical front, Nifty 50 gave a breakout from its recent narrow range and formed a bullish candle on the daily chart, indicating continuation of positive momentum,” said Chandan Taparia.
According to him, the Nifty 50 now has to hold above 25,000 zones for an up move towards 25,200 then 25,400 levels, while on the downside, support is seen at 24,850 then 24,700 zones.
Bank Nifty Outlook
Bank Nifty index ended above the 55,300 level, and formed a bullish candle with long lower shadow on daily scale as buying interest is visible at lower zones and holding well above its 20 DEMA.
Now, the Bank Nifty index has to hold above 55,000 zones for an up move towards 55,750 then 56,000 levels, while on the downside, support is seen at 55,000 then 54,750 zones, Taparia said.
Chandan Taparia has recommended three stocks to buy today, May 16. Taparia recommends buying Reliance Industries, Hero MotoCorp and Jindal Steel & Power shares.
Stocks to buy
Reliance Industries | Buy | Target Price: ₹1,550 | Stop Loss: ₹1,410
Reliance share price has formed a bullish pennant pattern on the daily chart which suggests a continuation of the uptrend. The ADX line is rising which confirms the strength of the uptrend, Taparia said.
He recommends buying Reliance Industries shares for a target price of ₹1,550, while maintaining a stop loss of ₹1,410 level.
Hero MotoCorp | Buy | Target Price: ₹4,650 | Stop Loss: ₹4,180
Hero MotoCorp share price has broken out of a falling supply trendline on the daily chart with a large bodied bullish candle. A surge in volumes is visible to support the up move. The MACD suggests positive momentum, said the MOFSL analyst.
He recommends buying Hero MotoCorp shares for a target price of ₹4,650 and keeping a stop loss at ₹4,180.
Jindal Steel & Power | Buy | Target Price: ₹1,035 | Stop Loss: ₹935
Jindal Steel & Power shares have breached above a consolidation zone on the daily chart. Accumulation is visible at current levels to support the upwards momentum. The RSI indicator is positively placed which has bullish implications, Taparia said.
He suggests buying Jindal Steel & Power shares for a target price of ₹1,035 and stop loss of ₹935.
Disclaimer: The views and recommendations above are those of individual analysts, experts and broking companies, not of Mint. We advise investors to check with certified experts before making any investment decision.
