Coal India’s stock is looking very positive according to Santosh Meena from Swastika Investmart. He says that after a period of consolidation, the stock experienced a slight decline but found support at recent breakout levels. This suggests that the stock may continue to rise in the near future.
On Friday, there was a significant change in the behavior of Foreign Institutional Investors (FIIs). After 14 years, they shifted from being net short on the index to being net long. This means they are betting on the market going up. However, just before the weekly and monthly expiry, they started building up short positions again. This pattern has been seen before, where heavy short positions by FIIs preceded a big rally in the market.
There’s an interesting observation that whenever FIIs have heavily bet against the market in recent times, the market tends to rally significantly afterward. This suggests that there might be another big rally, possibly 1000-1500 points, if FIIs continue to hold short positions.
As we head into the next week, the market seems relatively calm despite upcoming events. This lack of excitement, coupled with a high number of short positions, could lead to a short covering rally where those who bet against the market rush to buy back their positions, driving prices higher.
On Monday morning, after the exit polls are out, there might be a gap-up opening if the news is favorable. However, there could be profit booking later, especially if the actual election results don’t meet expectations. Large-cap stocks like those in the Nifty index may continue to perform well, but mid-cap and small-cap stocks might see some profit taking due to concerns about high valuations.
Santosh Meena recommends two stocks to consider. First is Coal India, which he believes is on a strong bullish trend and could reach a target price of 525 with a stop loss at 472. The second is Hero MotoCorp, which is also showing bullish momentum and could target 5300 with a stop loss at 5000.
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