Hot Stocks | A sell call on Bank Nifty futures and Infosys futures; HDFC AMC a buy for gains in short-term

So far, the week has been encouraging for the bulls as the domestic market brushed off the previous week’s losses, ignoring the disappointment from the Union Budget and the fear of coronavirus.

The benchmark indices rallied for four consecutive sessions during this week. At this juncture, Nifty is trading with a gain of 4.08 percent and has retested the 12,150-mark, whereas Nifty Bank has gained 4.97 percent so far during the week.

For the last 3–5 weeks, we have been of the opinion that the zone of 12,400–12,500 should be used to exit long positions due to various negative technical evidence.

Technically, the recent fall towards 11,600 was in line with the expected impact of the weekly and monthly negative divergence in Nifty’s RSI.

Looking at the broader picture, it is evident that Nifty has been trading inside a rising channel and the top of 12,400 was the upper end of that channel.

Due to the correction, Nifty has confirmed a lower bottom formation on the weekly chart after August 2019. Thus, we are of the opinion that the ongoing upward move is just a pullback rally of the fall.

Yet again, higher levels like 12,150–12,300 could be used to exit longs or create short positions. On the downside, the intermediate support is placed at 11,950.