Edited excerpts from a conversation with Anand James, Head of Market Strategist, Geojit Investments Limited:
After a flat week, how would you trade the market now? Will Friday’s RBI optimism carry over into Monday? Friday’s optimism stemmed from the completion of the morning star pattern, marking a potential reversal from the downtrend that began on December 1. However, while the decline was short-lived, the rebound is likely to be short-lived as well, as evidenced by Friday’s stall at 26,200, a key congestion resistance.
Although the oscillators support a potential upside extension, we do not see enough momentum for a strong move higher. We initially support a swing low towards 26,085–26,065. Alternatively, a breakout above 26,200 could trigger further gains towards 26,460-26,550, but a sharp vertical rise is unlikely.
IT was among the biggest gainers in the week. Do you see a chance to go higher?
Yes, the IT sector shows strong potential for further growth. Nifty IT has been marking a reversal since September and recently broke above the weekly supertrend, indicating strength. The weekly RSI near 60, with the index closing above its 20-week high, reinforces the positive outlook. Based on these technical indicators, the index could hit 39,500 in the coming weeks.
Derivative data also support this bullish view. More than 50 percent of component stocks saw short gains at close OTM and long gains at year strikes. Additionally, 70% of stocks experienced a long build on Friday, while 80% recorded weekly short coverage, suggesting traders are positioned for further gains. Heavyweights like TCS, Infosys, HCL Tech, Wipro, and Tech Mahindra are showing strong weekly charts and are expected to lead the rally towards 39,500.PSU banks were under selling pressure but bounced back on Friday. Does the chart show the 52-week high again?
Although the index saw a rebound on Friday, the charts suggest a mixed outlook. Wedge pattern breakout in September and resulting losing momentum since November. A recent break below the rising trend line near 8,500 indicates a potential short-term trend reversal, while the weekly MACD shows bearish candles, signaling early signs of consolidation. Nevertheless, the longer-term charts still reflect the underlying strength, keeping the possibility of a new 52-week high alive.
Derivatives data showed some recovery efforts on Friday, with long additions and short covering in stock futures, but weekly data showed that more than half of positions were still added short. Among individual stocks, SBI, Bank of Baroda, PNB, Union Bank, Canara Bank, and Indian Bank may bounce back sharply early next week, though the sustainability is uncertain. The best strategy is to invest in any upside early next week while remaining cautious in the latter half.
Keynes ended the week down 21% amid negative reports. Do you see an upside chance or is it too risky to follow the falling knife?
Coins are now down 43.5% from their October highs, with Friday’s 12.5% decline marking the biggest one-day decline in the period. Momentum indicators and oscillators point to a strong downtrend with no signs of bearish exhaustion, raising the risk that the slide could extend to at least the year low of 3,825 seen in February. That said, the magnitude of Friday’s fall suggests that fears may have heightened.
Adding to that outlook, the only previous occasion the stock had extended so far above its 200-day moving average was in April, when the gap was around 25%. Currently, the stock is about 26% away from the 200-day SMA, prompting close monitoring for potential mean-reversion moves in the coming week. Given the contrarian nature of this outlook, a downside target of just under Rs 4,300 is suggested, with Rs 4,541 as the initial recovery target.
Give us your best ideas for next week.
COFORGE (CMP: 1977)
View: Taking
Target: 2080-2180
SL: 1882
The stock has been rising steadily since 2020 and is currently forming a cup and handle pattern on the charts. It is attempting a breakout from this formation, supported by the weekly RSI near 60 and the MACD above the signal line. Price action remains strong, trading well above the 20-, 50-, and 100-day moving averages, reinforcing the bullish outlook. The stock is expected to move towards Rs 2,080 and Rs 2,180 in the near term. Long positions should be secured with a stop-loss below Rs 1,882.
ABCAPITAL (CMP: 358)
View: Taking
Objective: 368-377
SL: 348
The stock has maintained strong growth since February 2025 and continues to show strength on both daily and weekly charts. The weekly MACD remains above the signal line, and the price is trading comfortably above the 20-, 50-, and 100-day moving averages, reinforcing the bullish outlook. The stock is expected to move between Rs 368 and Rs 377 in the near term. All long positions should be secured with a stop-loss below Rs.348.
