Markets near all-time high — what stocks to buy and when

Explaining the technical picture of the market, Shrikant Chouhan, Head of Research (Retail) at Kotak Securities, told CNBC-TV18 that the last 4-5 weeks’ pattern shows that benchmark equity indices are going to do really well. However, the analyst says the markets remain cautious as they are seeing gradual or poor activity.

"Eventually, the markets are finding a good amount of support whenever there is a correction. One thing is clear — there is buying happening in the market on a frequent basis," Chouhan noted.

On profit booking as Nifty approaches 19,000 levels, he said the strategy should be to buy on dips. He also said 17,800-18,000 levels are going to act as a very good support for the market. Further, the analyst said markets are likely to remain range-bound till the Nifty crosses 19,000 and the euphoria is expected only if it breaks 19,000 levels.

Speaking about Bank Nifty, Chouhan said the index looks bullish. The market expects Bank Nifty to move towards 45,500 levels, and on the downside, at 43,000 or 43,500 will act as a good support. "So, now the support has shifted from 40,000 to 43,500 levels  and in case there is any correction, then we should buy on dips," he said.

Chouhan advices on buying frontline and mid-size banks on dips. The analyst named few bank stocks, including State Bank of India, HDFC Bank, ICICI Bank and Canara Bank, as the preferred picks.

ALSO READ: Atul Suri remains bullish on India despite lack of market euphoria.

On Tuesday, the Nifty index experienced profit booking from its 78.6 percent retracement level of 18,450 after a previous fall from 18,888 to 16,823 levels. A bearish engulfing candlestick pattern formed on the daily chart, indicating possible profit booking in the market, experts said.