Technical Analysis

Technical Analysis of 1 stock (with 15-day horizon) [EasyDNNnews:PaidContentStart]

WHAT LIES AHEAD : NEAR-TERM PICTURE
SPOT NIFTY : The Nifty 50 index ended its threeday winning streak on Thursday, declining by 0.52 per cent to close below the 26,650 level. The index opened lower and struggled to make any significant upward movement from the opening level. It then slipped into further weakness during the early part of the session before moving into a narrow range and recovering marginally towards the end of the day. This price action resulted in the formation of a bearish body candle with a lower shadow.

The Nifty 50 index moved within a 178-point range on Thursday, the smallest in the last four trading sessions, which led to the formation of a Narrow Range 4 (NR4) candle. Moreover, the price action remained confined within the prior trading session’s range, resulting in the formation of an inside candle. The combination of NR4 and an inside candle suggests contraction, which is often followed by expansion. With the RBI policy meet outcome due on Friday, this could act as a trigger for an expansion in the range.

Currently, the index is trading between the 20-DMA and 50-DMA. The 50-DMA acted as resistance on Wednesday, while the bulls have managed to sustain above the 20-DMA. Going forward, the 20-DMA, currently around 25,454, is a key support level. A breach of this support could be negative for the index. Meanwhile, the bulls need to overcome the 50-DMA, positioned at 25,814, to gain upside momentum toward the 26,000 mark. Overall, it is advisable to stay light as long as the index trades between these two moving averages. Aggressive bets can be placed once either the support or resistance is breached, as this will likely trigger a trending move.

NIFTY DERIVATIVES: Following last Thursday’s close at 25,418.90, Nifty extended its upward move through the week and concluded today’s session at 25,642.80. The index showed steady strength after a phase of consolidation, reflecting improvement in overall market sentiment. On a weekly basis, Nifty advanced by nearly 0.88 per cent, or 223.9 points. ATM Implied Volatility (IV) has moderated significantly, dropping from last week’s elevated level of 15.68 to around 9.99, pointing towards cooling volatility. India VIX also softened during the week, declining from 13.37 to 12.17, indicating a reduction in market uncertainty. Meanwhile, the Put-Call Ratio (PCR) for the upcoming weekly expiry has moved lower from last week’s 0.978 to 0.648, placing it firmly in the oversold zone.

For the coming weekly expiry, total call open interest stands at 29,96,987 contracts, while total put open interest is at 19,42,006 contracts. Among the call options, the 27,000 strike carries the highest open interest at 2,79,513 contracts, followed by the 26,000 with 2,27,694 and the 25,800 strike with open interest at 1,81,019 contracts, respectively. On the put side, the deep out-of-the-money strike 25,000 has the highest open interest at 1,47,451 contracts, followed by the 24,000 strike with 1,32,268 contracts and the 25,500 strike with 1,00,676 contracts. The Max Pain level for the upcoming expiry is positioned at 25,700.

STOCK STRATEGY
STEEL AUTHORITY OF INDIA LTD ................ BUY ............. CMP ₹157.90
BSE Code ...... 500113
Target 1 .... ₹175 
Target 2 .... ₹180 
Stoploss ...₹147 (CLS)

■ Current Observation: SAIL is an integrated iron and steel manufacturer, producing both carbon and special steel for industries such as Construction, engineering, power, Railways, automotive, consumer durables, and defense. Currently, SAIL owns and operates five integrated steel plants: Bhilai Steel Plant (BSP), Durgapur Steel Plant (DSP), Rourkela Steel Plant (RSP), Bokaro Steel Plant (BSL), and IISCO Steel Plant (ISP). The company also operates three special steel plants: Alloy Steel Plant, Salem Steel Plant, and Visvesvaraya Iron & Steel Plant.

■ On the weekly chart, the stock experienced a breakout earlier this year from a horizontal trendline, as it faced resistance around the Rs 143-145 level. The breakout was accompanied by a sizable bullish candle and above-average volume. Following this, the stock reached a high of Rs 160. During recent market volatility, the stock re-tested its breakout level and moved higher. On the weekly chart, the stock is trading above the 20-period moving average, and the 14-week RSI has shifted into a strongly bullish range. The MACD on the weekly timeframe is pointing upward while staying above its 9-period average, further validating the positive bias for the stock. On the daily chart, a positive crossover has also occurred.

■ Buy the stock with a target of Rs 175-180 and a stop loss at Rs 147.

REVIEW OF STOCK STRATEGY
In issue no. 14, dated January 22, 2026, we recommended purchasing shares of Indian Bank at Rs 897. The stock marked a breakout of a long-term trend continuation price pattern at the time of recommendation. Post breakout, it witnessed a sideways correction with lower activity in the volume cluster, which can be considered a pullback move. However, post budget, the banking sector witnessed a sharp selloff, and Indian Bank too. To avoid further losses, we exited the position at Rs 840. This update is shared exclusively through the Flash News app to ensure our subscribers receive timely and accurate information.

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