The market closed higher for the first time in five sessions on December 16, but the broader markets were under pressure as the Nifty Midcap 100 and Smallcap 100 indices fell 0.69 percent and 0.83 percent.
The BSE Sensex climbed more than 100 points to close above 57,900, and the Nifty50 rose 27 points to 17,248, supported by technology stocks, Bajaj Finance and index heavyweight Reliance Industries.
Stocks that were in focus include Bajaj Finance and Infosys, which were the top two gainers in the Nifty50. Bajaj Finance rallied 2.65 percent to close at Rs 7,028.85, and Infosys jumped 2.16 percent to Rs 1,771.60.
L&T Infotech was the fifth biggest gainer in the futures and options segment, rising 2.46 percent to Rs 6,839.55.
After a sharp pullback rally from Rs 6,700, the stock took the resistance near Rs 7,500 and corrected sharply. In this week so far, the stock corrected nearly 6 percent from the level of Rs 7,477.
On the daily and weekly charts, the stock has maintained lower top series formation which is broadly negative for it. However, after a long correction, the stock took the intermediate support near Rs 6,850.
We are of the view that the medium-term trend is still in to the down side but strong possibility of one pullback rally is not ruled out if it succeeds to trade above Rs 6,850.
Above the same, the pullback rally will continue up to Rs 7,150-7,225. On the other side, dismissal of Rs 6,850 could trigger one more leg of correction till Rs 6,750-6,700.
After a short-term price correction, the stock took the support near 100-day SMA (simple moving average – Rs 1,709). After the correction, it has been consistently taking support between Rs 1,700 and Rs 1,735 levels.
On the daily charts, the stock has formed higher bottom formation which indicates strong possibility of fresh uptrend from current levels.
For the positional traders, Rs 1,735 or 20-day SMA would be the key level to watch out for. If it trades above the same, it will move up to Rs 1,800-1,815.
L&T Infotech has formed double bottom formation after a short-term correction. The stock is trading near Rs 6,900 breakout level and the texture of the chart suggests strong possibility of fresh breakout in the near term.
In addition, after a long time on the daily charts, it succeeded to close above the 20-day SMA, which is broadly positive. We are of the view that Rs 6,650 would act as a key support level.
Unless it trades below Rs 6,650, positional traders should retain an optimistic stance and look for an upside at Rs 7,200-7,400. Fresh buying can be considered now and on dips between Rs 6,900 and Rs 6,800 levels with a stop loss below Rs 6,650.
0
0
