Short-covering rally may take Nifty to 23,000-23,150, says analyst

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Jatin Gedia, VP, technical research, Teji Mandi Investment Technologies Pvt Ltd Nifty, Bank Nifty strategy Nifty consolidated between 22,760 and 22,550 after a 350 points rally in the pre trading session. It tested the neckline at 22,550 and saw buying interest. It is crucial that Nifty sustains above today low of 22,550 and surpasses the immediate hurdle at 22,800 (the previous swing high), which could trigger a short-covering rally towards 23,000-23,150.

The daily momentum indicator has a positive crossover; therefore, use this pullback toward the neckline as a buying opportunity. Inability to surpass the 22,800 resistance zone could lead to more consolidation between 22,300 - 22,800. Bank Nifty is also consolidating between 54,700 - 55,700 ahead of the quarterly results of the two heavyweights, HDFC Bank and ICICI Bank, over the weekend.

The daily momentum indicator has a positive crossover which is a buy signal but follow through buying interest is missing. Considering the price action and the momentum setup, we expect the Bank Nifty to consolidate between 54,700 - 56,700. A breach of this range could trigger a trending move.

A breakdown would lead to a retest of 53,800 - 53,700, while moving above 55700 could trigger a rally 56,200 -56,500. Stocks to buy today Britannia Industries View: Buy @ ₹4,928 SL: ₹4,850 Target: ₹5,100 Britannia Industries has been in a downtrend. It has reached the weekly as well as monthly lower Bollinger band support and is witnessing buying interest.

Today it has broken out of a base triangle on the upside, suggesting the a short term trend reversal. It is trading above the 20 day moving average ₹4,874 indicating short term strength. Daily momentum indicator has a positive crossover, which is a buy signal.

Jamna Auto View: Buy @ ₹149.12 SL: ₹145 Target: ₹161 Jamna Auto has been in an uptrend. The recent pullback found buying interest from the ₹141 level which coincides with the 50 per cent Fibonacci retracement level of the ₹128 - ₹152 rally. In terms of price pattern it has broken out of a bullish flag pattern suggesting start of a fresh leg of up move.

The momentum indicator has triggered a positive crossover which is a buy signal. Thus, both price pattern breakout and the momentum setup suggest that the stock is poised for an up move over the next few trading sessions. Sun TV View: Buy @ ₹651 SL: ₹633 Target: ₹705 Sun TV has been in an uptrend.

For the past couple of weeks the stock has been consolidating after the sharp up move. Today the stock has witnessed a breakout from a five day consolidation on the upside suggesting resumption of the next leg of the up move. Breakout has been accompanied by above-average volume suggesting buying interest in the direction of the trend.

Momentum indicator has triggered a fresh positive crossover from below the equilibrium line suggesting start of a fresh leg of up move. Thus, the price volume breakout and the momentum suggests the stock is likely to resume its upmove.