BSE still heading towards 24,000

Price at time of writing – 22,445.

Successive updates in early April highlighted a strong breakout above stubborn resistance by India’s leading share index, and triggered my strong buy recommendation in the process.

This strength has continued recently, and my initial target at 24,000 remains firmly intact.

Although the Sensex is down a little from its high on 21 April (at 22,877), this is a perfect technical development. The relative strength index had extended to a much overbought short-term reading, and the cooling has allowed this to unwind. We now have clear space between the index’s current level and its support band defined as 20,400-20,835. This near-2000 point safety margin should allow the support band to hold firm even if global markets pull back further.

More generally, I have detected better trends emerging on other Asian share markets recently. My March update suggested buying the Thailand share market too, and that breakout also remains on course to fulfill higher levels.

Recommendation: stay long. Trading target 24,000. Ultimately, a target as high as 38,256 can be expected in years ahead. Stop-losses remain unchanged, and activated only on momentum below 20,400.

BSE Sensex chart

IGA, may distribute information/research produced by its respective foreign marketing partners within the IG Group of companies pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the research is distributed in Singapore to a person who is not an Accredited Investor, Expert Investor or an Institutional Investor, IGA accepts legal responsibility for the contents of the report to such persons only to the extent required by law. Singapore recipients should contact IGA at 6390 5118 for matters arising from, or in connection with the information distributed.

This information/research prepared by IGA or IGA Group is intended for general circulation. It does not take into account the specific investment objectives, financial situation or particular needs of any particular person. You should take into account your specific investment objectives, financial situation or particular needs before making a commitment to trade, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. In addition to the disclaimer above, the information does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. Any views and opinions expressed may be changed without an update.

See important Research Disclaimer.