Most sectors, especially auto, energy FMCG, and metal witnessed gains, while banking and financials lagged behind. Bargain buying in mid- and small-cap stocks after recent corrections also contributed to the gain in the market, which helped the index close above 24,450.

Buy: ITC Ltd (current price: ₹ 437)

● Why it’s recommended: Strong financial performance, growth prospects, market position, and operational efficiency

● Key metrics: P/E: 26.64, 52-week high: ₹ 495, volume: ₹ 502.63 crore

● Technical analysis: Bounced back from its 100-DMA

● Risk factors: Overvaluation concerns, high ESG risk rating

● Buy at: ₹ 437

● Target price: ₹ 465 in three months

● Stop loss: ₹ 421

● Why it’s recommended: Strong market position in precision engineering, export growth, and global presence

● Key metrics: P/E: 80.36, 52-week high: ₹ 1,504, volume: ₹ 69.45 crore

● Technical analysis: downward sloping trendline breakout and 200-DMA retake

● Risk factors: Margin sensitivity to raw material costs and exposure to cyclical industries

● Buy at: ₹ 1,165

● Target price: ₹ 1,400 in three months

● Stop loss: ₹ 1,055

Read this | Q4 shareholding moves: Institutional appetite for post-correction mid-caps grows

How Nifty 50 performed on 5 May

Nifty 50 opened with a gap-up on Monday, 5 May, and maintained a positive trajectory through the session. While the index formed a small bullish candlestick on the daily chart, it failed to break the previous session’s high, suggesting some overhead resistance. Still, the broader price structure on both daily and weekly charts remains constructive.

Participation from the broader market was strong, with mid- and small-cap indices showing robust gains. Over 30% of NSE 500 stocks are now trading above their 200-day moving average, reflecting underlying market strength. The advance-decline ratio improved to 2:1, further confirming supportive breadth.

Technically, the index is trading above all key moving averages, reinforcing the prevailing bullish trend. It has convincingly crossed the immediate resistance zone of 24,400–24,450, backed by positive momentum. The RSI continues to trend higher, and a bullish MACD crossover supports the case for further upside.

Read this | Q4 earnings watch: When rising input costs came to bite again

According to O’Neil’s methodology, Nifty 50 has now moved from a “Rally Attempt” to a “Confirmed Uptrend.” With momentum in its favour, the index could head toward the 24,700–24,900 range in the near term. Key support remains at 24,000–23,900.

How did Nifty Bank perform?

Bank Nifty ended lower on Monday, 5 May, slipping below the 55,000 mark after weak Q4 results from Kotak Mahindra Bank dampened sentiment. The index opened slightly higher at 55,065.80 but remained volatile, swinging between an intraday high of 55,786.50 and a low of 55,345.50 before closing at 54,919.50. On the daily chart, it formed a bullish candle with a lower-high, lower-low structure, signaling indecision.

Technically, Bank Nifty continues to trade above all key moving averages, indicating underlying strength. However, it has been consolidating over the past week, suggesting a pause in momentum. The RSI remains in positive territory but has slipped from 67.16 to 65, pointing to weakening bullish momentum. The MACD still shows a positive crossover above the zero line, but is tilting toward the signal line—an early sign of fading strength.

According to O’Neil’s methodology, Nifty Bank has shifted from an “Uptrend Under Pressure” to a “Confirmed Uptrend.”

Also read | Treasury gains save SBI’s day, but couldn’t avert earnings downgrades

The index remains in a sideways consolidation at elevated levels. While the broader trend is intact, a decisive breakout above the 55,500–55,600 resistance zone is needed to confirm a fresh bullish leg. On the downside, immediate support is placed near 54,000, which should cushion any near-term pullback.

MarketSmith India is a stock research platform and advisory service focused on the Indian stock market. It offers tools and resources to help investors make informed decisions based on the CAN SLIM methodology, founded by legendary investor William J. O’Neil. You can access a 10-day free trial by registering on its website.

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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.