Kaynes shares plunge 43% from October peak. Is a tactical rebound on the playing cards or extra ache forward?
Edited excerpts from a chat with Anand JamesChief Market Strategist, Geojit Investments Restricted:
After a flat week, how would you commerce the market now? Would Friday’s RBI optimism carry ahead on Monday as effectively? Friday’s optimism stemmed from the completion of a morning star sample, signaling a possible reversal from the downtrend that started on December 1. Nevertheless, whereas the downswing was temporary, the reversal can also be prone to be short-lived, as evidenced by Friday’s stall at 26,200, a key congestion resistance.
Though oscillators assist a potential uptrend extension, we don’t see adequate momentum for a powerful transfer increased. We favor a swing decrease towards 26,085–26,065 initially. Alternatively, a breakout above 26,200 might set off additional positive factors towards 26,460–26,550, however a pointy vertical rise is much less probably.
IT was among the many main gainers within the week. Do you see probabilities of extra upside?
Sure, the IT sector reveals robust potential for additional upside. Nifty IT has been signaling a reversal since September and lately broke above the weekly supertrend, indicating energy. The weekly RSI close to 60, together with the index closing above its 20-week excessive, reinforces the optimistic outlook. Primarily based on these technical cues, the index might goal 39,500 within the coming weeks.
By-product knowledge additionally helps this bullish view. Over 50% of constituent shares noticed brief additions in close to OTM put strikes and lengthy additions in name strikes. Moreover, 70% of shares skilled lengthy build-up on Friday, whereas 80% recorded weekly brief overlaying, suggesting merchants are positioning for additional positive factors. Heavyweights like TCS, Infosys, HCL Tech, Wiproand Tech Mahindra present robust weekly charts and are anticipated to steer the rally towards 39,500.PSU banks had been underneath promoting stress however recovered on Friday. Does the chart point out a recent 52-week excessive once more going ahead?
Though the index noticed a pullback on Friday, the charts counsel a blended outlook. The wedge sample breakout in September and the ensuing upside has been dropping momentum since November. The latest breakdown under the rising trendline close to 8,500 signifies a potential short-term pattern shift, whereas the weekly MACD reveals exhaustion candles, signaling early indicators of consolidation. Regardless of this, longer-term charts nonetheless replicate underlying energy, protecting the potential of a recent 52-week excessive alive.
Derivatives knowledge reveals some restoration makes an attempt on Friday, with lengthy additions and brief overlaying in inventory futures, however weekly knowledge signifies that greater than half of the positions nonetheless concerned brief additions. Amongst particular person shares, SBI, Financial institution of Baroda, PNB, Union Financial institution, Canara Bankand Indian Financial institution might even see a fast pullback early subsequent week, although sustainability stays unsure. The popular technique is to capitalize on any early upside subsequent week whereas remaining cautious within the latter half.
Kaynes ended the week down 21% amid detrimental experiences. Do you see probabilities of an upside bounce or is it too dangerous to chase the falling knife?
Kaynes has now fallen 43.5% from its October peak, with Friday’s 12.5% decline marking the steepest single-day drop throughout this era. Momentum indicators and oscillators level to a powerful downward pattern with no indicators of bearish exhaustion, elevating the chance that the slide might lengthen to not less than the yr’s low of Rs 3,825 seen in February. That mentioned, the severity of Friday’s fall means that concern might have peaked.
Including to this view, the one earlier event the inventory had stretched so removed from its 200-day shifting common was in April, when the hole was round 25%. Presently, the inventory is almost 26% away from the 200-day SMA, prompting shut monitoring for potential mean-reversion strikes within the coming week. Given the contrarian nature of this view, the draw back marker is suggested barely under Rs 4,300, with Rs 4,541 because the preliminary restoration goal.
Give us your prime concepts for the week forward.
COFORGE (CMP: 1977)
View: Purchase
Goal: 2080-2180
SL: 1882
The inventory has been in a gradual uptrend since 2020 and is presently forming a Cup and Deal with sample on the charts. It’s making an attempt a breakout from this formation, supported by a weekly RSI close to 60 and a MACD above the sign line. The worth motion stays robust, buying and selling effectively above the 20-, 50-, and 100-day shifting averages, reinforcing the bullish outlook. The inventory is predicted to maneuver towards Rs 2,080 and Rs 2,180 within the close to time period. Lengthy positions must be protected with a stop-loss positioned under Rs 1,882.
ABCAPITAL (CMP: 358)
View: Purchase
Goal: 368-377
SL: 348
The inventory has maintained a powerful uptrend since February 2025 and continues to point out energy on each every day and weekly charts. The weekly MACD stays above the sign line, and the worth is buying and selling comfortably above the 20-, 50-, and 100-day shifting averages, reinforcing the bullish outlook. The inventory is predicted to maneuver towards Rs 368 and Rs 377 within the close to time period. All lengthy positions must be protected with a stop-loss positioned under Rs 348.
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