The Nifty50 has made an intermediate top near the all-time high levels in the range of 12,930-12950 over the past 3 days and witnessed profit-booking henceforth.

The index left four gaps over the past 2 weeks and we believe that it will revisit those gaps to test the previous top and 20-Day average levels.

The rotational move among various sectors is also over and we do not expect any sector to lead the up move from current levels.

We expect a corrective action over the next few weeks and markets to be volatile due to rollover movements in individual sectors and stocks with respect to derivatives expiry next week.

On the higher side, 13000 would act as strong resistance being the round number and highest call OI of 37.8 lakhs shares.

The midcap index also scaled to a 52-week high with strong outperformance in the current week and would continue to outperform the broader indices and largecaps.

The Nifty Media has been an underperformer in the current up move, but higher bottoms on weekly charts and trading above the long-term average suggest risk-reward in favour and a strong up move from current levels with a stop loss of 1380 levels.


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Muthoot Finance: Buy | LTP: Rs 1169 | Target Rs 1290 | Stop Loss: Rs 1115 | Upside 10%

The stock has completed its corrective action from the recent high of 1405 levels and is holding its band of averages.

The Daily RSI is trading above the lower band and confirms a reversal from current levels. There are multiple support levels in the range of Rs 1130-1140 levels that would be protected and offer a good risk-reward ratio.

Tech Mahindra: Sell | LTP: Rs 821 | Target: Rs 720 | Stop Loss: Rs 890 | Downside 12%

The stock scaled to a new all-time high in the first week of October and is making lower tops over the past few weeks.

It has broken from its short and medium-term averages indicating a reversal from current levels. The negative divergence in RSI from higher levels and higher low formation confirms our negative stance on he stock.

V-Guard: Buy | LTP: Rs 176 | Target: Rs 210 | Stop Loss: Rs 157 | Upside 19%

The stock closed at a 5-month high with strong volumes and is trading above the long-term average line. It has also crossed its 200-Days average and we expect a sharp breakout from the congestion zone.

The Relative Strength Index has crossed upwards from its lower band of averages and we expect the stock to outperform from current levels.