GR Exclusive: Sensex To Touch Another Record High Soon? Technical Analyst's Investment Strategy For 2024

A little over a month is left for 2023, and the Indian market has touched some remarkable milestones despite challenging macroeconomic scenarios amid geopolitical tensions. Anand Rathi's technical analyst Jigar S. Patel in an interview with GoodReturns.In said, the year 2023 so far has been with resilience and all-time highs for key benchmark indices. He did not rule out the possibility of yet another record high from Sensex by the year-end.

For 2024, Patel guides traders to be very stock-specific and book profits at regular intervals. In the case of midcap and small-caps that have logged extraordinary upside year-to-date, he believes that investors should opt for cashing in gains as they are overly extended, meanwhile, in large-cap baskets, he believes only IT stocks are lucrative.

General elections will be a major development in 2024, to which, the analyst believe the market may react volatile however after election results they are likely to pick up momentum. Apart from this, Patel believes it would be a daunting task for Nifty to cross 20,000 in the near term, while Sensex may see resistance around 66,500 to 67,000.

Patel recommends Aarti Industries shares for buying for a target price of Rs 610 in 2024.

So far, in 2023, Sensex has gained by a whopping 4,802.25 points or 7.85%, while Nifty 50 rallied by 1,597.25 points or 8.78%. In the second half of this year, Sensex also touched a lifetime high of 67,927.23, and Nifty 50 clocked a historic high of 20,222.45.

Currently, Sensex and Nifty 50 are below 66,000 and 19,800 levels. As of November 24th, the 30-scrip benchmark stood at 65,970.04 and Nifty 50 at 19,794.70. Uptrend is expected in the coming weeks.

Here are the excerpts from the GR interview with Anand Rathi's technical analyst Jigar Patel:

Q: What is your overall outlook for India's stock market in 2023? Will Sensex touch another record high, if yes, why?

The year went by with resilience and all-time highs for key benchmark indices, despite global turbulence like high interest rates, rising bond yields, crude oil prices, and the Middle East crisis. Nifty has been in a solid uptrend on the monthly charts. The index took out a 19-month consolidation, which pushed it towards 20222, which was its all-time high. Though Nifty saw some correction but not a major one during the year, before continuing its major uptrend, we may see a small correction until 18500 in the coming time. Apart from Nifty IT, other sectors like auto, FMCG, pharma, and metals are hovering near the top, which may call for booking profit in the coming months. Investors and traders need to be very stock-specific in the coming month and keep booking profits at regular intervals

Yes, Sensex will touch another record high as mentioned above we are already in well well-established uptrend.

Q. With general elections scheduled in early 2024s, how will it impact the Indian stock market

In the past, we have seen that during general elections, the market might become very volatile, and later on, it settles as soon as the election results are out and continues its uptrend.

Q. Midcap and small-caps have performed remarkably higher than large-caps in 2023, have the bullish trend in these stocks flavoured out, or more upside is seen ahead

Nifty Midcap-100 and Nifty Small-Cap 100 have pumped in almost 44% and 61% respectively, during 2023, as compared to NIFTY 50, which comes to around 20% only. There is no doubt about the fact that midcap and smallcap are way ahead of nifty 50 in terms of gains. Investors and traders should opt for profit booking in small-cap and mid-cap since both charts are looking overly extended.

Q. Are large-caps gaining momentum, and if yes, which sectors look attractive?

Only NIFTY_IT looks lucrative at current levels where investors should use buy on dips strategy. Nifty IT has been making higher highs and higher lows on a regular basis, which is a sign of strength. Heavyweights like TCS and Infy will contribute to Nifty IT since it looks lucrative at current levels. Recently, price action has reversed firmly on a weekly scale, with a big green candle exactly from its credible support of 30000. Also, RSI Weekly has reversed from 50 levels, further adding bullish bias. Other sectors like Pharma, Banking, Auto and FMCG can witness profit booking in coming few months.

Q. What do you expect for Sensex, and Nifty in 2024?

Since there is a lot of overhead resistance in the nifty 50 near 19875-20000, it will be a daunting task for bulls to cross at least in the coming couple of months. where Sensex resistance is placed near 66500-6700. We expect a continuation of the major uptrend from March to April 2024 before a small correction to 18500 levels is expected.

Q. Are there any recommendations, or sectors you think will rise in 2024?

- BUY AARTIIND: IN THE RANGE OF 525-535| TARGET: 610| STOP LOSS: 490.s

For the last two months, the counter has been under selling pressure. There is massive support near 485-495 in the form of a monthly central pivot range. On the indicator front, weekly DMI's have given a bullish cross, which further hints towards a bullish bias in the counter. One can buy in the zone of 525-535, and the target would be 610 and the stop-loss would be 490 on a daily close basis.

Q. Is there anything you would like to add for traders?

The technical chartist lists three pointers for traders to keep in mind when investing in the stock market. These are -- 1) Be stock specific; 2) Always use a hedge if holding huge positions; and 3) Keep booking profits at regular intervals.

Disclaimer: The recommendations made above are by market analysts and are not advised by either the author nor Greynium Information Technologies. The author, nor the brokerage firm nor Greynium would be liable for any losses caused as a result of decisions based on this write-up. Goodreturns.in advises users to consult with certified experts before making any investment decision.