Nifty IT Set to Bottom Out? Anand James Weighs in on Expiry Outlook, Pharma Profit-Booking, and Top 2 Stocks to Buy This Week!

The Nifty index appears poised for a potential breakout this week, with Geojit Investments’ Anand James pointing to a crucial resistance level around 23,700. After experiencing a small gain last week, the market is entering a holiday-shortened monthly expiry week. Analyzing recent market trends, James has noted signs of volatility coiling tightly, suggesting an impending expansion rather than further compression. Notably, the Nifty has managed to close above its 10-day Simple Moving Average (SMA) for the first time since May 8, reinforcing a positive outlook as long as it remains above 23,600, with potential targets set in the 23,900 to 24,450 range.

In the IT sector, early indicators suggest that the Nifty IT index may be bottoming out following its low on May 14. The index has held key support between 28,900 and 28,700, reflecting buying interest at these levels. This stability lends credence to calls for a potential short-term recovery. Additionally, derivative data reveals a shift from previous bearish positions, with short covering evident across 90% of stock futures, further supporting a near-term recovery. However, there remains a cautionary note due to the absence of significant long build-up, as resistance around the 30,900-31,000 zone looms ahead.

As for specific stock recommendations, Geojit Investments highlights Surya Roshni and Cholamandalam Investment as top picks for short-term trading opportunities. Surya Roshni is exhibiting a bullish setup after consolidating around the 235 mark, with an upside target of 260 and a stop-loss at 231. Similarly, Cholamandalam Investment has shown a solid rebound from a base near the 1,480-1,500 zone, targeting a move to 1,605 with a stop-loss at 1,480. Both stocks demonstrate positive momentum that could attract traders looking for short-term gains amidst current market dynamics.

Source: The Economic Times

(Expert Note: This report was prepared by the Wealthova team.)