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On Monday, 4 August, the Nifty 50 advanced by 157.40 points or 0.64%, ending the session at 24,722.75, while the BSE Sensex rose 418.81 points or 0.52%, closing at 81,018.72. The Bank Nifty showed no major momentum, finishing flat with a negligible gain of 1.75 points, at 55,619.35, reflecting ongoing stress in the financial space despite broader market recovery.

Why Kaynes Technology is recommended: Kaynes Technology is displaying strong bullish momentum on both daily and intraday charts. The Relative Strength Index (RSI) is at 62, reflecting strengthening momentum. MACD is positive at 38, and ADX at 21.50 confirms a trending move. On the 15-minute chart, a bullish triangle breakout is evident, suggesting a continuation of the upward trend.

Technical analysis: The alignment of bullish indicators across timeframes and a clean triangle breakout enhances conviction. With momentum building, a move toward ₹6,440 looks likely if the price holds above the breakout point with volume support.

Risk factors: A failure to sustain above ₹6,228 would invalidate the bullish setup. Absence of volume follow-through could dampen the move.

Buy at: ₹6,297

Target price: ₹6,440

Stop loss: ₹6,228

Why TVS Motor is recommended: TVS Motor is trading near a crucial resistance zone around ₹2,954 and is poised for a breakout. The RSI is at 65, MACD at 6, and ADX at 15—all indicating strengthening bullish momentum. A breakout above this resistance could trigger a swift up-move.

Technical analysis: The stock is showing rising momentum with a favorable indicator setup. A breakout above ₹2,954, supported by volume, would confirm bullish continuation and likely push it toward ₹3,030.

Risk factors: A reversal below ₹2,882 would invalidate the bullish outlook. Watch for volume to confirm breakout.

Buy at: ₹2,942

Target price: ₹3,030

Stop loss: ₹2,882

Why Hitachi Energy is recommended: Hitachi Energy is showing sustained bullish strength with RSI at 62, MACD at 466, and ADX at 18 on the daily chart. The stock is trading above all major moving averages, indicating a strong uptrend.

Technical analysis: With price action firmly above moving averages and key momentum indicators aligned, the stock looks set to test ₹21,725. A continuation of volume participation will be key for further upside.

Risk factors: A drop below ₹20,940 would negate the bullish structure. Lack of momentum could stall the move.

Buy at: ₹21,200

Target price: ₹21,725

Stop loss: ₹20,940

While financials and FMCG stocks faced mild profit-booking on Monday—with the FMCG sector dipping 0.10% and the finance index slipping 0.06%—optimism returned in other segments. The realty sector led the rebound with a 1.77% gain, followed by the auto sector up 1.61%, and the metal index, which rose 0.69%, indicating a rotational shift into value and cyclical plays.

In terms of stock action, Hero MotoCorp led the charts with an impressive 5.20% rally, followed by Tata Steel climbing 4.28%, and Bharat Electronics, which added 3.27%, all driven by renewed institutional interest and sectoral momentum.

However, undercurrents of weakness persisted, particularly in key index components. PowerGrid tumbled 4.51% amid valuation concerns, while HDFC Bank dropped 3.91%, and ONGC slipped 3.33%, signaling that sentiment around heavyweight counters remains fragile.

On 4 August, the Nifty ended the session on a positive note, closing at 24,722.75, up 157.40 points or 0.64%. This gain marks a short-term relief after the recent weakness, but the index remains in a corrective structure and below key resistance levels.

Despite the bounce, the broader trend remains cautious as the index is yet to reclaim the critical 25,000-25,074 zone, which would be essential to signal a more sustainable reversal.

Technically, the index continues to trade below key short-term moving averages such as the 20-day SMA (25,074) and the 40-day EMA (24,793), keeping the bearish undertone intact. The recovery appears more like a pullback within a larger downtrend rather than a trend change.

Daily indicators are still mixed. The Relative Strength Index (RSI) stands at 41.83, improving slightly but remaining in neutral territory. The MACD continues in negative terrain at −116.02, indicating bearish momentum is still dominant.

However, some indicators like the Commodity Channel Index (CCI) at −120.95 and Momentum at −367.95 are now in oversold zones, hinting at a possible bottoming attempt—although not yet confirmed.

On the intraday (hourly) timeframe, the indicators show a bit more resilience. The hourly RSI has moved up to 49.90, and the Momentum indicator has turned positive at 71.50, suggesting improving short-term sentiment.

The MACD on the hourly chart has also started to recover, with a reading of −29.63, hinting at a possible bullish crossover. That said, the ADX at 19.91 still indicates a lack of trend strength, meaning the move may not have strong follow-through unless supported by fresh triggers.

From a derivatives perspective, the options data reveals a mixed but slightly improving sentiment. Total Call OI stands at about 150.1 million, still higher than the Put OI of 125.9 million, resulting in a Put-Call Ratio (PCR) of 0.84—reflective of lingering caution.

However, the change in OI tells a different story: Put OI increased by 43.9 million, while Call OI rose only by 625.5 million, giving a net bullish OI shift of 37.7 million contracts. This suggests that traders are beginning to hedge less aggressively for the downside, or are positioning for a near-term bounce.

In terms of strike positioning, 25,000 continues to hold the highest Call OI, marking a major resistance. Fresh Call writing at 25,300 adds to this ceiling. On the downside, the highest Put OI is now placed at 23,500, while fresh Put additions were concentrated at the 24,600 strike—indicating that support is now firming up just below the current level.

In conclusion, while the Nifty showed signs of stabilization on 4 August, the broader trend remains cautiously bearish until the index convincingly reclaims 25,000-25,074 levels. For now, this move should be treated as a pullback within a downtrend, not a full reversal.

Immediate support lies in the 24,600-24,450 zone. A break below 24,450 could accelerate the fall toward 24,000, where a prior gap remains unfilled.

Traders should continue to adopt a tactical approach—sell on rise near resistance, and avoid aggressive long positions unless there's a clear breakout above the key moving averages.

Ankush Bajaj is a Sebi-registered research analyst. His registration number is INH000010441.

Investments in securities are subject to market risks. Read all the related documents carefully before investing. Registration granted by Sebi and certification from NISM in no way guarantees performance of the intermediary or provide any assurance of returns to investors.

Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before making any investment decisions.

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