investment strategy: Nifty falls near 18,000: investors can take partial profit and re-enter at 17,400: Vaishali Parekh

“Investors can book partial profits in their portfolio and wait for the next reversal as Nifty has the near-term support zone near the 17300-17400 levels,” says Vaishali ParekhVice President – Technical Research, Prabhudas Lilladher Pvt. ltd.

In an interview with ETMarkets, Parekh said: “As far as trading is concerned, most of the activity recently seen in sectors such as real estate, cement, PSU banks and some private banks were at honor where a decent volume attendance was observed”, Edited excerpts:

What a week for Indian markets – Sensex moved above 60,000 while the Nifty moved closer to 18,000 but pared gains towards the end of the week. What led to the price action?
Most of the indicators hovered in the strong oversold zone and the stocks were also trading at attractive rates which market participants seized the opportunity, which led to a decent rise.

Foreign institutional investors (FIIs) are shifting from sell to buy mode, adding more fuel to the price action with sectors like autos, consumer staples, bank stocks, real estate and many others are performing well, taking the indices almost to their maximum levels.

India VIX is up over 3% over the past week as we approach 18K. Are there any key levels the markets should follow over the coming week? Will Nifty50 be able to recover 18000-18200 in August series expiry week?
The Nifty50 has seen a decent rise in the recent past as it is now approaching the 18,000 benchmark, which is also a psychological resistance barrier that everyone would focus on.

A correction is occurring in this area which would not be a surprise and short term support would be around the 17300-17400 area.

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A pause and some decline would be healthy for the market as it would help market participants to reinvest with conviction again.

If there are dips in the coming week, should investors do it? Buy the dip or wait on the sidelines as there might be additional selling pressure?
The Nifty50 may witness some exhaustion near the 18000 level and see some slides in the next few days.

Investors can book partial profits in their portfolio and wait for the next reversal as Nifty has the near-term support zone near the 17300-17400 levels.

The strong and crucial base of support is found near the 17000 area, where the important 200-DMA is also found.

Where is the smart money going when it comes to trading? What are traders’ favorite stocks over the past week?
In terms of trading, most of the activity has recently been seen in sectors such as real estate, cements, PSU banks and some private banks were in the spotlight where decent volume participation was seen .

Metro Brands, is up around 40% in one week in the S&P BSE 500 Index. What drove the price action and what does the technique suggest? What should investors do?
These stocks have outperformed in the recent past and are technically in the overbought zone with the trend remaining intact. Investors can book partial profits and if a correction is seen, which would be better for stocks, they can wait for the next trend reversal to continue rising.

(Disclaimer: The recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)

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