NIFTY Index Chart Analysis

In the last fortnight, except for a day or two of bullish trending, the Nifty 50 index has traded within a broad range. On May 15, 2025, the index reclaimed the important psychological level of 25,000 and has since mostly moved within the wide-ranged bullish candle formed that day.

During the past week, the index briefly slipped below the 20-day moving average (20-DMA) and the low of the May 15 wide-range bullish candle on an intraday basis. However, it found support, bounced back, and formed an inside bar on the weekly time frame. The formation of an inside bar on the weekly timeframe indicates that the benchmark index took a breather after the sharp thousand-point rally seen in the week prior May 12–16) to the last one. Overall, the underlying strength remains intact, as the index did not breach the prior week’s low or key support levels. Such counter-trend consolidations are common following a strong impulse move.

Following the significant 395-point gain on May 15, volumes have declined. That said, down days have attracted more volume than up days. Over the last fortnight, two distribution days have been added, bringing the total to six, which is relatively high. With this many distribution days, if the index falls below key support levels or the 50-DMA, it would signal caution for the bulls. That said, the benchmark remains above all its key short- and long-term moving averages. Both the 20- and 50-DMAs are trending upwards, suggesting that this is a counter-trend consolidation after a sharp rise, and the overall trend remains intact.

Pattern analysis shows that the Nifty has established a trading range between 25,150 on the upper side and 24,400 on the lower side. This means a clear directional bias will emerge only if the Nifty convincingly moves above 25,150 or breaks below 24,400. Until one of these occurs, the index is likely to continue consolidating within this range.

The Relative Strength Index (RSI) on both daily and weekly charts has retreated from the 60 level. The weekly MACD line remains above its signal and the zero line, while on the daily chart, the MACD is above the signal but below the zero line.

Importantly, the Average Directional Index (ADX), which measures trend strength, is below 25 on both daily and weekly charts. Once the ADX rises above 25, it signals that a trend is gaining momentum, and in combination with the Directional Indicator (DI) lines, we can determine the trend’s direction.

Overall, the market continues to trade in a benign environment, facing strong resistance in the 25,120–25,150 zone. As long as the Nifty remains below this level, it remains vulnerable to corrective spikes, which could keep volatility slightly elevated. Given the current technical setup, it is crucial to rotate sectors wisely to stay invested in stronger pockets while protecting existing gains with trailing stop losses. Additionally, maintaining leveraged positions at modest levels is advisable. Nondirectional strategies may be appropriate as long as the index stays within this range.

STOCK RECOMMENDATIONS

CCL PRODUCTS (INDIA) ...................... BUY .......................... CMP ₹842.25
BSE Code : 519600
Target 1 .... ₹930 
Target 2 ..... ₹990 
Stoploss....₹790 (CLS)

CCL Products (India) is engaged in the production, trading, and distribution of coffee. The company operates primarily in India, Vietnam, and Switzerland.

The share price of CCL Products has surged over 60 per cent from its April low. With this strong upward move, the stock is now on the verge of breaking out of a horizontal trendline on the weekly time frame. Currently, the stock is trading near its all-time high and is technically well-positioned, trading approximately 26 per cent and 19 per cent above its 50-day and 200-day moving averages, respectively.

The stock meets most of the CANSLIM characteristics. It has an EPS Rank of 78, which is a fair score; a Relative Strength (RS) Rating of 86, which is good and indicates outperformance compared to other stocks; Buyer Demand at grade B, reflecting recent demand for the stock; and a Master Score of B, which is close to the highest rating.

The 14-period daily RSI is in a super bullish zone and rising, which is positive for the stock. The daily MACD remains above its nine-period average, further validating a positive bias. Considering these factors, we recommend buying this stock with a target price of ₹930–990 and a stop loss at ₹790.

INTERARCH BUILDING SOLUTIONS ............ BUY ................... CMP ₹2,162.00
BSE Code : 544232
Target 1 ...... ₹2,440
Target 2 ..... ₹2,520 
Stoploss.....₹1,890 (CLS)

I nterarch Building Solutions Limited commenced operations in 1983. Forty years later, Interarch is one of India’s leading turnkey providers of pre-engineered steel construction solutions, offering integrated design and engineering, manufacturing, and on-site project management for steel buildings. The company has recently acquired an additional 20 acres adjoining its existing Andhra Pradesh facility to establish a dedicated unit for pre-engineered heavy steel structures. This expansion will enable the company to undertake and deliver complex, large-scale projects in emerging sectors such as data centers, semiconductors, and renewable energy manufacturing facilities.

The stock recently registered a breakout accompanied by strong volume, indicating increased participation in the trend direction. It meets most CANSLIM criteria except for group rank. The stock has an EPS Rank of 95, a great score reflecting earnings consistency; an RS Rating of 94, also great, indicating strong relative performance; Buyer Demand at A+, showing robust recent demand; and a Master Score of B, near the top of the scale.

Given the favourable technical setup, we recommend buying this stock with a target price of ₹2,440–2,520 and a stop loss at ₹1,890.

*LEGEND:  ◼ EMA - Exponential Moving Average.  ◼ MACD - Moving Average Convergence Divergence  ◼ RMI - Relative Momentum Index  ◼  ROC - Rate of Change  ◼ RSI - Relative Strength Index
(Closing price as of May 27, 2025)

Disclaimer : Above recommendations are based on various technical parameters and any fundamental input has not been considered for the recommendations. Follow strict stop loss for the recommendation.