Stock picks of the day for August 17, 2018

After enjoying a five-week solid upswing, Nifty50 is finally showing early signs of fatigue. Indices have entered into a consolidation phase at the current juncture on account of multiple headwinds.

The Indian rupee failed to halt its weakening trend as the currency continued to free fall against the US Dollar on Thursday. The Rupee breached the psychological Rs 70 per dollar mark in the previous trading session and hit a fresh all-time low of Rs 70.39/USD on Thursday.

In addition, global weakness further continues to dent the sentiment on the street. However, the overall scenario for the Indian equity markets has not changed as yet as higher peak and higher trough structure continues to remain intact.

The short-term trend is likely to reverse only if Nifty breaches below the 11,340 levels on closing basis. On the upside, a break above the resistance of 11,500 would trigger a fresh breakout for the Nifty.

The Nifty Pharma index continues to show immense strength post the breakout that it witnessed two weeks earlier. In fact, the index has managed to form a bullish engulfing pattern which further strengthens our conviction on the sector.

The Nifty Midcap 100 index remains stuck in a narrow trading band and is forming Flag pattern and is also sustaining above its long-term 200-DEMA which is a positive development.