Stock picks of the day: Go long on Nifty with a stop-loss below 10,800

The Nifty fell 72 points on September 16 as crude oil prices surged more than 10 percent following the September 14 drone attack on Aramco’s production and refining facilities. A weaker rupee versus the dollar also dampened sentiment.

Though Nifty has fallen, it is still trading above its 20-Day SMA. Oscillators and momentum indicators like RSI and MACD have been showing strength on the daily as well as weekly charts for the Nifty and Bank Nifty.

The Nifty has been trading in the Symmetrical Triangle on the daily chart. Last week, we saw the index reaching near the higher band of the triangle placed around 11,090 levels. This level could act as a short-term resistance.

In derivatives, we have seen Put writing at 10,800-11,000 strike prices, which indicates that the index is likely to find strong support around 10,800 levels.

Unless Nifty closes below it, the trend would be considered bullish for the markets. On the upside, 11,200 levels, where Calls have been written, is likely to act as an immediate resistance. This resistance level also coincides with the 200-Day SMA which is placed at 11,224 levels.