Here is why Paytm and BirlaSoft should be on your radar
The short-term trend for Nifty is positive as long as it trades above the 18,000-mark.
PremiumThe headline indices - Nifty and Bank Nifty - witnessed strong buying momentum throughout the week except in the last trading session. The index ended on a flat note. The outperformance continued in the Nifty PSE and CPSE index which were up by more than 1%. The bears returned to the market, as the benchmark Nifty ended the last day of the week with a loss of 1%. Over the week, the Nifty remained volatile before closing flat for the week. A profit booking of around 18,200 led to Friday's fall, which took Nifty back to the previous week's close.
The short-term trend will, however, remain positive as long as the index remains above 18,000. A fall below 18,000 may take the Nifty into the consolidation zone of 17,500–18,000. On the other hand, a rejection from the 18,000 level may reintroduce a buying spree, which may take the Nifty back to above 18,200; again, a decisive move above 18,200 may take it towards 18,500–19,000.
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The Bank Nifty bears took control and the index fell by more than 2% breaking the support of the 43,000-42,800 zone. The index, if sustained below 43,000, will witness further correction towards the 42,500-42,300 zone where the next demand area is visible. The upside resistance of 43,000 if taken out decisively will lead to further short covering toward 43,300 levels.
Two stocks to look at for the short term:
Paytm | Target: ₹710-718
Paytm has given a breakout from a 10-day consolidation phase with a sharp surge in volumes. The momentum indicator RSI has given a positive crossover and is trading above the level of ₹660, confirming the buy signal. The lower-end support is visible at the ₹670-660 zone which will act as a cushion for the bulls and the potential upside targets are ₹710/718.
BirlaSoft | Target: ₹300
BirlaSoft has given a consolidation breakout on the daily chart, suggesting a rise in optimism. Besides, the price has remained above the critical moving average. The RSI is in a bullish crossover. Over the short term, the stock is likely to move towards ₹300. On the lower end, support is visible at ₹270.
The author, Kunal Shah, is Senior Technical & Derivatie analyst at LKP Securities
Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before taking any investment decisions.
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