Dean Kim sees next Nifty support at 2% below current levels

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Dean Kim, Head of Global Research Product, William O’Neil + Co. predicts Nifty’s next crucial support level at its 100 day moving average (DMA), which is about 2% below the current level of 22,125.

The resistance is at 21-DMA, which is 1% higher than current levels, he told CNBC-TV18.

While Kim remains constructive on India, he has downgraded Japan and South Korea.

“All the other major Asian countries are under pressure including India. But at least in India, you are finding some support at the 50-DMA,” he added.

Among sectoral bets, Kim sees a lot of interesting names in basic material, and capital equipment.

“I am looking at BASF, Solar Industries, Steel Authority of India Ltd (SAIL), Zen Technologies and so on,” he said.

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Auto equipment makers Sona BLW Precision, Shriram Pistons and Rings, Indo Count, Finolex Industries, and some select financial names like Muthoot Finance, Central Depository Services (CDSL) and PFC are also looking attractive from an early-stage breakout, he added.

He believes in large-cap tech names, one may stay with Tata Consultancy Services (TCS) versus Infosys at the moment.

“TCS is consolidating for the moment, so maybe wait for a breakout from the base. Infosys, on the other hand, looks fairly vulnerable. It is below the 200-DMA and looks like it must go lower, so I would be careful with Infosys,” he said.

Also Read | Trade Setup for April 18: Midcaps, Smallcaps offer some hope as Nifty grinds lower

Infosys will announce its results for the January to March 2024 quarter on April 18 after its peer TCS kicked off the Nifty 50 earnings last week.

A CNBC-TV18 poll of analysts suggests that India’s second-largest IT services company is likely to witness a revenue decline for the second quarter in a row while margin and profit shall increase marginally.

The guidance it gives for the 2024-25 fiscal year will be key to track.

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow