Traders can lighten long positions in 15,000-15,100 zone: Vinay Rajani

The Nifty50 index has breached the crucial support of 14,753, which happened to be the previous top on the daily Chart. It has also violated the supports derived from 5, 10 and 20 days SMA. RSI oscillator has also exited overbought zone with negative divergence on the daily chart. However, we can not rule out the stock specific bullish moves. Current market setup is offering trading opportunities in both directions. As far as Nifty is concerned 15,000-15,100 is a zone, which should be utilized to lighten the trading long commitments. Support for the Nifty is seen at 14,336 odd levels, where 50 days EMA is placed.

Stock recommendation:

BUY HIND PETRO (245) | Target: Rs 260 | Stop-loss: Rs 235

The stock price has broken out from multiple top resistances placed at 237. The stock has also broken out from inverted head and shoulder pattern on the weekly chart. Volumes during the breakout too remained high. Moving average and Oscillator setup are showing strength in the current uptrend. Entire energy sector is outperforming the broader market for last couple of weeks.

BUY MUTHOOT FINANCE (1,286) | Target: Rs 1,360 | Stop-loss: Rs 1,240

The stock price has been forming flag pattern on the daily chart. Primary trend of the stock has been bullish and it is about to break out from the recent flag formation, which would be a sign of continuation of the primary uptrend. The stock has been trading above all important moving average parameters. Indicators and oscillators like RSI, MACD and DMI have turned bullish on short term charts.

Disclaimer: Vinay Rajani is Senior Technical and Derivative Research Analyst at HDFC Securities. The analyst doesn’t have any holding in the stock. Views are personal.

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