Hot Stocks: A close above 12,050 will open doors for Nifty50 to touch 12,300 levels

Benchmark index on the daily chart has formed a Small Rounding Bottom pattern, and the base for that got created near 11,800 levels. The Nifty50 has sustained its gap-up opening on November 20th but witnessed mild profit booking on an intraday trading basis.

In the last few sessions, we saw some cooling off in Nifty50 as it went through some consolidation phase as well. But, Wednesday’s gap-up opening looks encouraging now as it managed to give a convincingly close beyond its previous seven days candle on a daily basis with slightly average volume.

In the derivatives front, put writing was seen at 11,800-11,700 strike prices, indicating Nifty is likely to find strong support in the range of 11,700-11,800.

Unless Nifty closes below it, the trend would be considered bullish for the markets from the derivative side. On the higher side, call writing was seen at 12,000 levels.

The Nifty Metal & Pharma index is well poised for a new rally which can be visible on the weekly chart. State-run banks are a major center of attraction since the past couple of trading sessions and current chart formation suggests that investors should hold on to their bullish positions with trailing stop loss.