..... . VALI disclosures . .....: 05/01/26, The Indian stock market has been witnessing healthy buying over the last few days. The Nifty 50 hit an all-time high of 26,340. For the week ended 2 January, the index rose by 1.10%, extending gains to a second consecutive week.

Monday, January 5, 2026

05/01/26, The Indian stock market has been witnessing healthy buying over the last few days. The Nifty 50 hit an all-time high of 26,340. For the week ended 2 January, the index rose by 1.10%, extending gains to a second consecutive week.

The domestic market remained resilient in 2025 despite significant global and domestic headwinds, including US tariffs, the rupee's fall against the dollar, weak earnings, stretched valuations, and massive foreign capital outflow.

Amid all these challenges, benchmark indices managed to deliver steady gains, with the Sensex advancing 9% and the Nifty 50 rising over 10%.

"This marked the tenth consecutive year of positive returns for Indian equities. Strong and consistent participation from domestic institutional investors and retail investors played a crucial role in offsetting net FII selling of over ₹1.44 lakh crore," Jigar S. Patel, Senior Manager of Equity Technical Research at Anand Rathi Share and Stock Brokers, noted.

"Although volatility remained elevated for much of the year, a sharp rebound in the final quarter enabled indices to recover from a prolonged consolidation phase and revisit higher levels," Patel added.

From a near-term technical perspective, the Nifty opened the previous truncated week with a gap-up but struggled to sustain above the 26,300 resistance zone, leading to a gap fill and a mild corrective phase.

Patel highlighted that the 25,950-25,850 region acted as a critical gap-based support area, with overall downside risk capped as long as 25,700 held on a closing basis. The index respected this support band, staged a strong rebound, and has since registered a decisive breakout above 26,200.

"This price action confirms a bullish cup and handle formation, carrying a pattern projection of roughly 400 points and indicating potential upside towards the 26,500-26,600 zone, provided current levels are maintained," said Patel.

"For the near term, 26,100 remains a key support for Nifty; a close below this level would weaken the bullish structure. Until a clear follow-through above resistance zones emerges, a selective, stock-specific approach within quality broader market names is advisable," said Patel.

Stock picks for the short term

Jigar Patel recommends buying the following three stocks for the next one to two weeks:

Varun Beverages (VBL) | Previous close: ₹493.80 | Buying range: ₹495 to ₹485 | Target price: ₹550 | Stop loss: ₹460

Patel highlighted that VBL has witnessed a decisive trendline and triangle breakout, indicating a resumption of the primary uptrend.

The momentum setup is supportive, with RSI registering a breakout and currently hovering near the 55 level, reflecting improving strength without entering overbought territory.

Additionally, the MACD has generated a bullish crossover, reinforcing the positive momentum bias.

From a price-volume perspective, the stock has also managed to close above its quarterly VWAP, which typically acts as an important medium-term reference point for institutional participants and further validates the breakout.

"Given the confluence of these bullish technical signals, a buy-on-dips approach is recommended in the ₹495-485 zone. On the upside, the stock has the potential to move towards the ₹550 level in the near to medium term. Risk should be managed with a strict stop loss placed below ₹460 on a daily closing basis to protect against any false breakout or broader market weakness," said Patel.

Havells India | Previous close: ₹1,439.90 | Buying range: ₹1,445 to ₹1,430 | Target price: ₹1,560 | Stop loss: ₹1,365

According to Patel, Havells has exhibited a strong improvement in technical structure, marked by a clear RSI range breakout alongside a decisive price trendline breakout, as observed on the chart.

Momentum indicators are supportive, with the RSI indicating strengthening buying interest, while the MACD has confirmed a bullish crossover, reinforcing the positive bias.

From a trend perspective, the stock has closed above its 10- and 20-day DEMA, signalling short-term strength, and has also reclaimed the monthly VWAP, which enhances the credibility of the emerging uptrend and reflects improved institutional participation.

"Given this favourable technical setup, a buy-on-dips strategy is advisable in the ₹1,445-1,430 zone. On the upside, the stock has the potential to move towards the 1,560 level in the near term," said Patel.

"Risk management remains crucial, and a stop loss should be maintained below ₹1,365 on a daily closing basis to guard against any reversal or breakdown in momentum," Patel said.

Indian Renewable Energy Development Agency (IREDA) | Previous close: ₹146.64 | Buying range: ₹147 to ₹143 | Target price: ₹162 | Stop loss: ₹136

Patel said IREDA is showing encouraging technical signals after forming a well-defined double bottom pattern on the chart, indicating a potential trend reversal.

The setup is further supported by bullish divergence, suggesting improving momentum despite earlier price weakness.

The stock has managed to close above its 10-day exponential moving average (DEMA), highlighting short-term strength.

Additionally, RSI has witnessed a trendline breakout, reflecting renewed buying interest, while the MACD has generated a bullish crossover, reinforcing the positive bias.

Price action has also confirmed strength with a close above the previous swing high, which improves the probability of further upside.

"Based on this technical structure, traders may consider buying on dips in the ₹147-143 zone. On the upside, the stock has the potential to move toward ₹162. A strict stop loss should be maintained at ₹136 on a daily closing basis to manage risk," said Patel.

source:Mint/Dailyhunt

Disclaimer: This story is for educational purposes only. The views and recommendations expressed are those of the expert. We advise investors to consult with certified experts before making any investment decisions, as market conditions can change rapidly and circumstances may vary.

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Trade Cycles

The four important features of Trade Cycle are (i) Recovery, (ii) Boom, (iii) Recession, and (iv) Depression!

The trades cycle or business cycle are cyclical fluctuations of an economy. A full trade cycle has got four phases: (i) Recovery, (ii) Boom, (iii) Recession, and (iv) depression. The upward phase of a trade cycle or prosperity is divided into two stages—recovery and boom, and the downward phase of a trade cycle is also divided into two stages—recession and depression.

Phases of Trade Cycle:

The phases of trade cycle are explained with a diagram:

(1) Recovery:

In the early period of recovery, entrepreneurs increase the level of investment which in turn increases employment and income. Employment increases purchasing power and this leads to an increase in demand for consumer goods.

As a result, demand for goods will press upon their supply and it shall, thereby, lead to a rise in prices. The demand for consumer’s goods shall encourage the demand for producer’s goods.

The rise in prices shall depend upon the gestation period of investment. The longer the period of investment, the higher shall be the price rise. The rise of prices shall bring about a change in the distribution of income. Rent, wages, interest do not rise in the same proportion as prices.

Consequently, the margin of profit improves. The wholesale prices rise more than retail prices. The prices of raw materials rise more than the prices of semi-finished goods and the prices of semi-finished goods use more than the prices of finished goods.

(2) Boom:

The rate of investment increases still further. Owing to the spread of a wave of optimism in business, the level of production increases and the boom gathers momentum. More investment is possible only through credit creation. During a period of boom, the economy surpasses the level of full employment and enters a stage of over full employment.

(3) Recession:

The orders for raw materials are reduced on the onset of a recession. The rate of investment in producers’ goods industries and housing construction declines. Liquidity preference rises in society and owing to a contraction of money supply, the prices falls. A wave of pessimism spreads in business and those markets which were sometime before sellers markets become buyer’s markets now.

(4) Depression:

The main feature of a depression is a general fall in economic activity. Production, employment and income decline. The prices fall and the main factor responsible for it is, a fall in the purchasing power.

The distribution of national income changes. As the costs are rigid in nature, the margin of profit declines. Machines are not used to their full capacity in factories, because effective demand is much less. The prices of finished goods fall less than the prices of raw materials.

✳Reality Tips to Traders

1)Trading in the stock market is a marathon. 2)Protecting your capital is key. (Learn to protect first) 3)Making 0 on the day is better than losing 50k 4)Losses happen; they are part of this business. 5)It’s not you vs. the market. It’s you VS you. 6)You are your biggest enemy; learn to be mentally disciplined. 7)Don’t follow the majority; follow the correct path. 8)Traders without a stop loss end up not being traders for long. 9)There is always another trade. 10)The big money is made waiting for the right set-ups. 11)Waiting for the right trade is the most powerful strategy. 12)It is better to cut a loss than to wait to be proven right. 13)Position sizing can make or break you. 14)Worry about the downside before you even think about the upside. 15)Don’t listen to headlines

..BANKING TERMINOLOGY

There are various types of Banks: PSU Banks, Private Banks, Co-operative/Regional Banks, Small Finance Banks and Foreign Banks. When you deposit money in a bank, let's say the bank gives you an interest rate of 4%. But when the bank lends out this money, they lend it out at say, 12%. The difference of 8% in the above scenario is effectively the profit of the bank! The loans that do not pay interest for 90 days are known as Non-performing Assets. Banks have to provide for such bad loans. Structure of a Bank Asset for a Bank: The asset portion of a bank's capital includes cash, government securities, and interest-earning loans (e.g., mortgages, letters of credit, and inter-bank loans). Liabilities for a Bank: The bank's main liabilities are its capital (including cash reserves and, often, subordinated debt) and deposits. The latter may be from domestic or foreign sources (corporations and firms, private individuals, other banks, and even governments). Banks are required to maintain Liquidity with the Reserve Bank of India: SLR (Statutory Liquidity Ratio): It is the money a bank needs to preserve in the form of cash, gold or government Bonds before providing credit customers. This limitation is added by RBI on banks to make funds available to customers on-demand at your earliest convenience. Banks are required to maintain SLR at 18%. CRR (Cash Reserve Ratio): Banks are required to hold a certain proportion of their deposits in the form of cash. Banks don’t hold these as cash with themselves, but deposit such amounts with RBI / currency chests. CRR rate is at 4.5% currently. Repo Rate: The rate at which the RBI lends short-term money to the banks. The RBI through its Monetary Policy committee changes the repo rate to balance growth and Inflation. Reverse Repo rate: The rate at which banks park their short-term excess liquidity with the RBI. Now let us understand various terminologies for Banks Net Interest Income (NII): This is the spread the bank makes on its lending. It is calculated as Interest Income – Interest Expended Net Interest Margin (NIM): This is the spread the bank makes on its lending. It is the earning which is left after deducting the cost paid to depositors from its yields on Loans. This is denoted in % terms. The formula is Yield on Loans – Cost of funds Capital Adequacy Ratio (CAR): The capital adequacy ratio (CAR) is a measure of a bank's available capital expressed as a percentage of a bank's risk-weighted credit exposures. Essentially, it is the Capital that is available to lend. Tier I Capital – In simple words this capital is freely available with the bank to lend out. Tier II Capital- This is the capital tied up somewhere and is less freely available to lend. In case of an adverse event, the bank can use this capital to lend. Under Basel III norms, a bank’s tier 1+tier 2 capital must be a minimum of 8% of its risk-weighted holdings. The minimum capital adequacy ratio, also including the capital conservation buffer, is 10.5%. Current Account Saving Account (CASA)- There is no interest paid on the Current Account and a small interest rate is paid on a savings account. The combination of both is called CASA which shows the liabilities of the bank on which it pays relatively less interest. Deposits: Bank deposits are a savings product that customers can use to hold an amount of money at a bank for a specified length of time. In return, the financial institution will pay the customer the relevant amount of interest, based on how much they choose to deposit and for how long. Now let us come to NPA. Gross NPA (GNPA): It is the total loans on which no payment has been paid for 90 days or more. GNPA % is usually shown in each Bank’s quarterly results. The percentage is basically the GNPA amount as a % of the total advances. Slippages: Slippages denote the fresh amount of loans that have turned bad in a year. The slippage ratio of a bank is calculated as Fresh accretion of NPAs during the year /Total standard assets at the beginning of the year multiplied by 100. Provisioning Coverage Ratio (PCR): This is the ratio of provisioning to GNPA and indicates the extent of funds a bank has kept aside to cover loan losses. For Instance, a company has GNPAs of Rs 100 and they have set aside 50 Rs, then the PCR is 50%. Net NPA (NNPA): The total figure left after deducting provisions made for bad loans from GNPA. (GNPA – Provisions+upgrades/writeoffs = NNPA) Special Mention Account (SMA) SMA-0 is a category in which stress with respect to the principal and interest has remained overdue for a period of 0 to 30 days. SMA-1 is a category in which stress with respect to the principal and interest has remained overdue for a period of 30-60 days. SMA-2 is a category in which stress with respect to the principal and interest has remained overdue for a period of 60-90 days

..... . VALI disclosures . .....

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Monday, January 5, 2026

05/01/26, The Indian stock market has been witnessing healthy buying over the last few days. The Nifty 50 hit an all-time high of 26,340. For the week ended 2 January, the index rose by 1.10%, extending gains to a second consecutive week.

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16/01/26, STOCK MARKET GUIDE

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