rss-bridge 2026-03-01T05:04:10+00:00

Nifty below 200-DMA but oscillators yet to signal outright collapse: Anand James

Nifty’s decisive breach of its 200-day SMA at the close of the month has intensified concerns around a potential retest of recent swing lows, signalling that the market’s medium-term support framework is under pressure, says Anand James, Chief Market Strategist at Geojit Investments.

[Nifty below 200-DMA but oscillators yet to signal outright collapse: Anand James]
ETMarkets.com

*Nifty’s decisive breach of its 200-day SMA at the close of the month has intensified concerns around a potential retest of recent swing lows, signalling that the market’s medium-term support framework is under pressure, says Anand James, Chief Market Strategist at Geojit Investments.*

However, he notes that momentum oscillators have yet to confirm a full-fledged breakdown, indicating that an outright collapse is not imminent unless key support levels are decisively breached.

Edited excerpts from a chat:

Nifty ended the week around 1% lower as IT stocks pulled the index down. How do you see the market shaping up in the first week of March?

After persistently preventing a breakdown despite multiple attempts throughout the month, the 200-day SMA finally gave way on the last working day of the month. This has raised worries of a retest of February lows of 24571. However, with the first test of the lower Bollinger band, with super trend support at 25033 available within touching distance, we are hopeful of a recovery move in the second half of the week. However, slippage past the 25000 region could negate the prospects of a near-term recovery. That said, oscillators are yet to signal an outright collapse.

In the last 3 days, Nifty IT attempted to climb up. What do you think is this a dead cat bounce or sustainable uptrend? Is it too early to say that IT stocks have bottomed out?

Over the past few sessions, Nifty IT’s bounce looks more like a technical rebound than the start of a sustainable uptrend. The index recently hit a fresh 52 week low near 29875, and despite a minor uptick, it continues to trade below key moving averages, confirming a bearish setup.

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On the daily chart, price remains below the immediate resistance at 31100-31300, and only a decisive move above 33200-34400 would indicate a structural trend change. Until then, rallies are vulnerable to selling. The weekly chart reinforces this weakness with the index breaking down from a recent H&S structure, marking a clear bearish phase.

If we look at the seasonality, the last 15 years show that March has been net negative on average for the Nifty IT Index, with a low win rate of just 40% and relatively high volatility, forming a bearish cloud over the sector.

Given this backdrop, it is too early to declare a bottom. For a meaningful trend reversal, the index must protect 30,000 and form a higher low and reclaim and hold above 33,200-34,400.

Hence, the recent uptick in Nifty IT is more likely a dead‑cat bounce than the beginning of a new uptrend. The sector remains in a deep corrective phase with no confirmed bottom yet. We will wait for the price to reclaim key resistance zones before treating any bounce as the start of a durable reversal.

In the last 3 trading sessions, have we seen shorts winding up in IT stocks?

Although the first two sessions of the new series witnessed short‑covering in several stock futures, major index constituents such as TCS, Wipro, and Tech Mahindra lost momentum on Friday. Around 60% of the near‑ITM and OTM call option strikes saw fresh short additions, indicating caution at higher levels. Additionally, nearly 60% of stock futures registered short build‑up on Friday, and close to 80% showed short additions on a week‑on‑week basis. Overall, the derivatives landscape suggests that traders remain unconvinced by the recent pullback and may be positioning lightly for further downside before considering fresh bullish exposure.

Metals are doing well. What are the charts telling you?

On the daily chart, the Nifty Metal Index is consolidating just below the 12450-12500 resistance zone, marked by multiple failed attempts to break higher. Candles show tight-bodied price action near the upper band of the previous rally, indicating buyers are still active but facing overhead supply. The trend structure remains positive with price holding above the short‑term moving averages and maintaining higher lows. However, the latest red candle and a mild rollover in the MACD histogram suggest short‑term loss of momentum, warranting caution if 12150-12200 is breached.

On the weekly chart, the index has displayed a strong medium-term uptrend, having broken above prior swing highs with expanding bullish candles. The price continues to ride the green cloud zone, reflecting healthy trend strength. Elevated volumes in recent weeks reinforce the possibility of institutional participation.

If we look at the derivatives picture, it presents mixed signals. Around 80% of metal stock futures saw short additions on Friday, while roughly 60% added longs on a week‑on‑week basis. Furthermore, nearly 80% of the near‑OTM call option strikes witnessed short build‑up on Friday. Taken together, F&O traders appear to be positioning for some short‑term negativity

So, expect near term weakness but a decisive weekly close above 12,500 could trigger the next leg higher.

Tejas was the biggest gainer in the week. How would you trade the stock now?

The steepness of the last two days’ rise as well as the approach of a near term resistance at 441 raises potential for a pause. However, we believe that the stock is poised for larger gains, supported by a narrow range breakout as well as bullish continuation patterns, projecting a near term objective of 522-533. Stop loss may be placed near 389 or 376.

Give us your top ideas of the week.

PARAGMILK (CMP: 202)

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View: Buy

Target: 222 – 235

Stoploss – 187

The weekly chart shows the stock in a corrective phase after a sharp decline from the 360-380 region. Price has now dropped toward a key support zone around 180-190, which aligns closely with the 200 WMA, historically a strong long‑term support area. The Doji candle formed in the weekly scale reflects a slowdown in bearish momentum, suggesting early signs of stabilization as buyers attempt to defend this level.

Despite the correction, the broader trend structure from mid‑2023 to 2025 still reflects a sequence of higher highs and higher lows keeping the longer‑term uptrend intact.

The weekly MACD histograms have shifted back in favor of buyers. A flattening or upward turn in the MACD line would serve as the first confirmation of renewed strength.

Overall, the stock is positioned at a critical support juncture warranting a pullback toward 225-235, while a decisive close below the 200-week moving average may open downside potential toward 160.

HEG (CMP: 578)

View: Buy

Target: 625

Stoploss – 560

HEG is displaying a steady medium‑term uptrend on the weekly chart, supported by consistent higher lows since mid‑2024. The price continues to trade well above the 200‑WMA, indicating strong long‑term structural strength. Recent candles show tightening consolidation between 540 and 600, suggesting the stock is building energy for its next directional move.

The latest bounce from the lower end of this range reflects active dip buying, keeping the overall bias positive as long as the stock holds above 560-40. A decisive weekly close above 600 would confirm a breakout continuation, opening the path toward higher targets.

The weekly MACD remains slightly positive but flat, implying momentum is still neutral and awaiting a trigger.

Overall, HEG remains in a constructive setup. Sustaining above support and breaking past 600 with volume would strengthen the bullish case.

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