If the share prices of HDFC Bank and Reliance Industries pick up steam simultaneously, according to stock market experts, the NSE Nifty may cross the 20,000 threshold soon.
The NSE Nifty may soon exceed the 20,000 milestone, according to stock market analysts, but only if the share prices of HDFC Bank and Reliance Industries pick up steam simultaneously.
Reliance's share price needs to approach $2,650 per share and HDFC Bank's share price needs to approach $1,700 per share levels, according to stock market experts, in order for the Nifty to cross the 20,000 milestone.
The NSE Nifty is expected to reach 20,000 in the near future, according to conjecture that has been stoked by the gap up opening of the key benchmark indexes of the Indian stock market on Thursday during early morning trades. Nifty is currently facing a barrier at 19,600, and stock market experts believe that the 50-stock index will only be able to break through this resistance on a closing basis before there is a greater likelihood of Nifty reaching 20,000 levels.
Market experts advised staying alert to changes in the share prices of Reliance and HDFC Bank in order to determine whether the upside will push the Nifty index close to the 20,000 milestone. They claimed that if the Nifty was to reach the historic 20,000 milestone in the current pace, it was crucial for the share prices of Reliance and HDFC Bank to gain momentum simultaneously.
Why is a rally for RIL and HDFC Bank significant?
Chandan Taparia, a derivative and technical analyst at Motilal Oswal, explained why HDFC Bank and Reliance shares are essential to Nifty's chances of reaching the 20,000 mark: "Nifty has significant support at 19,500, while it is seeing resistance at 19,600 levels. Only when Nifty heavyweights Reliance Industries Ltd. (RIL) shares and HDFC Bank shares gain momentum simultaneously can we anticipate Nifty to approach the historic 20,000 level. Together, these two equities account for close to 25% of the weight of the total index; therefore, momentum in these two shares should be seen as a hint that the Nifty is putting up a fight to reach the 20,000-point threshold.
Vaishali Parekh, Vice President of Technical Research at Prabhudas Lilladher, agreed with Chandan Taparia's assessment: "Nifty witnessed some volatility during the intraday session on Wednesday but managed to maintain the support placed at 19,500 zone and recovered strongly in the second half to close above the crucial hurdle of 19,600 levels further improving the bias and sentiment. We believe that as the broader markets are still actively participating, the benchmark index will go further closer to the 20,000 milestone during the next few days.
Chandan Taparia advised stock market investors to keep an eye on RIL and HDFC Bank shares, saying, "For Nifty to come near to 20,000 levels, Reliance share price must come close to 2,650 apiece levels, whereas HDFC Bank share price has to come around 1,700 apiece levels. At the moment, HDFC Bank's share price has critical support at levels of 1,560 per share, while RIL's share price has strong support at levels of 2,380 per share.
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