Markets still in a short term downtrend, near the 50 day SMA; sell Delta Corp, Indian Hotels to avoid losses

Markets still in a short term downtrend, near the 50 day SMA; sell Delta Corp, Indian Hotels to avoid losses

By Subash Gangadharan

On Daily chart, we observe that Nifty is still in a short term downtrend after touching a high of 18,888 in early December 2022. The index is however now near the crucial support of the 50 day SMA. A close below the 50 day SMA at 18144 and the recent lows of 18133 could trigger further weakness that could take the Nifty towards the next support of 17858. On the other hand a bounce back and convincing close above the recent swing highs of 18,473 could bring the bulls back into control. We recommend a wait and watch approach till we see signs of more clarity.

Indian Hotels: Sell

Indian Hotels is in a short term downtrend as it has been making lower tops and lower bottoms for the last few sessions. In the process, it has broken its near term support and seems to have reversed its recent short term uptrend. This indicates that the downtrend looks set to continue. Technical indicators are giving negative signals as the stock is now trading below the 20 day and 50 day SMA. Momentum readings like the 14-week RSI too are in decline mode and not oversold, which implies potential for more downsides. We therefore expect the stock to correct further in the coming sessions. Sell between the 307-312 levels. CMP is 309.5. Stop loss is at 327 while downside target is at 285.

(Subash Gangadharan, Senior Technical and Derivative Analyst, HDFC Securities. The stock recommendations in this story are by the respective research analysts and brokerage firms. FinancialExpress.com does not bear any responsibility for their investment advice. Capital markets investments are subject to rules and regulations. Please consult your investment advisor before investing.)