NIFTY Index Chart Analysis

The last fortnight was actionpacked, with a steady stream of news from both domestic and global fronts. To begin with, as anticipated, the Nifty 50 index sustained above the 25,200 mark and swiftly moved to nearly touch our first projected target of 25,700, recording a high of 25,669 on June 30, 2025. Following this, the market entered a phase of time-wise correction, with the price continuing to hold above the 20-day EMA.[EasyDNNnews:PaidContentStart]

Amid global developments, US President Donald Trump reaffirmed his intent to press ahead with his aggressive tariff policy, stating that no further extensions would be granted on country-specific levies, which are now scheduled to take effect in early August. He also hinted at potential new tariffs on imports of copper and pharmaceuticals. Despite this, Indian markets remained resilient. Notably, the India VIX — a measure of market volatility — slipped below 12, marking a three-month low.

On Tuesday, a key technical event occurred: the index closed above the previous session's high after six trading sessions, indicating a pause in the recent downward move. The Nifty has managed to hold above the breakout zone of its recent consolidation and has been forming higher bases, signalling inherent strength. It continues to trade above its 20-day EMA — a level that has acted as strong support since April 2025 — reinforcing the ongoing uptrend.

Looking ahead, the Nifty needs to decisively break above the 25,650–25,670 resistance zone to resume its upward trajectory. A successful breakout here could pave the way for the index to move towards the 25,900 mark and challenge its all-time high levels. On the downside, the index should ideally not breach the 25,000 level, which coincides with its 10-week moving average. Before that, immediate support lies in the 25,150– 25,300 range. This zone marks the confluence of the previous breakout area — where former resistance is expected to act as support, in line with the principle of polarity — and the rising 20-day EMA, which also falls in this region.

Going forward, all eyes will be on the outcome of the US-India bilateral trade deal and the onset of the Q1FY26 earnings season, both of which will play a crucial role in shaping the market’s direction. A favourable outcome could provide the momentum needed to challenge the all-time high levels in the coming month, with 25,000 continuing to serve as a strong support.

However, due to the ongoing consolidation, momentum appears to be tapering. The MACD histogram reflects this, showing a decline in daily momentum. Yet, the MACD remains in bullish territory and continues to trade above its signal line on both daily and weekly timeframes. The weekly RSI stands at 62.88, maintaining a neutral stance without exhibiting any negative divergence from the price.

From a seasonality standpoint, July has historically been a positive month for the Nifty. Since 2014, the index has ended in the red during July only once — in 2019. On average, the Nifty has delivered a return of 2.70 per cent in July, based on performance data since 2002.

STOCK RECOMMENDATIONS
DCM SHRIRAM LTD ........................... BUY .......................... CMP ₹1,406.80
BSE Code : 523367
Target 1 .... ₹1,640 
Target 2 ..... ₹1,700 
Stoploss....₹1,280 (CLS)

DCM Shriram Limited (DCM Shriram) is a diversified company with interests in the agriculture value chain (sugar including ethanol, agrochemicals, seeds, and urea) and the chloro-vinyl chain (chlor-alkali and PVC). The company is also involved in certain other related businesses to leverage vertical integration, such as Fenesta Building Systems (uPVC doors and windows, aluminium windows and façades), cement (produced at its integrated Kota plant), and PVC compounding through its subsidiary.

Technically, the stock has broken out of a base on its weekly chart and is trading about 2 per cent higher than the pivot point. The breakout above the base is supported by strong volumes, highlighting greater participation in the direction of the trend. As the stock is near its all-time high, it is trading above all its short- and long-term moving averages, all of which are trending upwards and are in the desired sequence. The stock meets most of the CANSLIM criteria, with an RS Rating of 89 (which is GOOD, indicating outperformance compared to other stocks), Buyer Demand rated at A- (evident from recent demand for the stock), a Group Rank of 32 (indicating it belongs to a strong industry group: Chemicals–Specialty), and a Master Score of A (which is the best rating).

The daily MACD is pointing northward and is sustaining above its 9-period average, validating the positive bias in the stock. Considering the above factors, buy this stock with a stop loss of ₹1,280 for a target of ₹1,640–1,700.

S. J. S. ENTERPRISES LTD ........................ BUY .................... CMP ₹1,262.50
BSE Code : 500084
Target 1 ...... ₹1,400 
Target 2 ..... ₹1,480 
Stoploss.....₹1,170 (CLS)

Established in 1987, SJS Enterprises (SJS) is a leading player in India’s decorative aesthetics segment. With a customer-centric approach, the company specialises in designing, developing, and manufacturing a wide range of customised products across 14 categories, efficiently serving 7 distinct segments.

Technically, the stock is nearing its pivot point and is trading above all its key moving averages—the 20, 50, and 200 DMA—all of which are trending upward and are in the desired sequence.

The stock meets the CANSLIM criteria with an EPS Rank of 91 (GREAT, indicating consistent earnings), an RS Rating of 90 (GREAT, indicating outperformance compared to other stocks), Buyer Demand rated at A- (based on recent demand for the stock), a Group Rank of 33 (indicating it belongs to a strong industry group: Auto/Truck–Replacement Parts), and a Master Score of A (the best rating). We recommend buying this stock with a stop loss of ₹1,170 for a target of ₹1,400–1,480.

*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 July 08, 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.

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