Key Takeaways
- You missed the Jan 20 bear trap – the market now favors a negative bias.
- Britannia, ONGC, HDFC Life, Mastek, Dalmia Bharat and JK Cement show bullish setups despite the broader sell‑off.
- Delhivery, Suzlon and Lodha Developers remain in strong downtrends; short positions are favored.
- Sector trends: Consumer staples and energy can outpace the index, while real‑estate stays under pressure.
- Historical patterns suggest that a break below last week’s low often precedes a 2‑3 week consolidation before the next directional move.
You missed the Jan 20 bear trap—now you’re paying for it.
Why the Jan 20 Bear Trap Signals a Negative Bias for Nifty 50
The Nifty 50 slipped 1.38 % on Jan 20, and market breadth turned sharply bearish: 2,552 decliners versus just 388 advancers. A bear trap occurs when a brief rally lures traders into long positions, only for the market to resume its downtrend. The break below the prior week’s low confirms that the rally was illusory and that the index is likely to consolidate with a downside tilt.
Technical definition: a "bear trap" is a false bullish signal that traps short‑term buyers, often identified by a rapid price swing above a resistance level followed by a quick reversal below a key support.
Historical context: In June 2023, a similar 1.4 % dip after a brief rally preceded a four‑week correction that erased 6 % of the index’s value. The pattern repeats when macro data (inflation, RBI policy) remains mixed.
Sector‑Wide Implications: Consumer Staples, Energy, and Insurance
Even as the broad market sagged, certain sectors displayed resilience. Consumer staples (Britannia) and energy (ONGC) kept buying pressure, indicating defensive rotation. Insurance (HDFC Life) entered oversold territory, a classic contrarian signal.
Competitor lens: Tata Consumer Products and Nestlé India are also trading near demand zones, mirroring Britannia’s consolidation. In energy, Reliance Industries remains above its 20‑day EMA, but ONGC’s tighter retracement suggests a stronger short‑term bounce.
Sector trend: The FMCG index has outperformed the Nifty by 0.9 % over the past month, while the real‑estate index has underperformed by 2.4 %.
Britannia Industries: A Consolidation Play in a Tight Demand Zone
Britannia (CMP ₹5,884) halted its correction and now sits near a crucial demand zone around ₹5,660. The price action shows a flat‑base formation, often a precursor to a breakout.
Technical cue: The stock respects the 50‑day moving average as dynamic support. A close above ₹5,660 could trigger a move toward the next resistance at ₹6,300.
Historical parallel: In March 2022, Britannia broke a similar demand zone and rallied 12 % over three weeks, driven by strong domestic sales and margin expansion.
Oil & Natural Gas Corp: Riding the Bullish Retracement
ONGC (CMP ₹240.39) experienced profit‑taking after a sharp rally, yet remains near a retracement zone that aligns with its 20‑day EMA. The chart shows higher lows, a bullish continuation pattern.
If the stock holds above ₹232, the next target lies at ₹257, echoing the July 2023 rally when ONGC broke its 200‑day EMA and surged 15 % in a month.
Competitor note: Reliance’s downstream segment is also respecting its 20‑day EMA, suggesting sector‑wide momentum.
HDFC Life: Oversold Momentum Ready to Flip
HDFC Life (CMP ₹732.1) sits in a downtrend on the daily chart, placing it in oversold territory. The Relative Strength Index (RSI) sits near 30, a classic reversal indicator.
A breach above ₹705 could unleash an uptrend toward ₹785. Conversely, a close below that level would warrant exiting longs.
Historical context: In February 2021, HDFC Life’s RSI dipped below 30, and the stock rallied 18 % in the subsequent ten sessions.
Mastek’s Triangle Breakout and Volatility Spike
Mastek (CMP ₹2,223.8) has outperformed the broader indices, closing above the prior day’s high for three consecutive sessions. The daily chart confirms a breakout from a symmetrical triangle, a pattern that historically yields 7‑10 % moves.
Bollinger Bands have widened, signalling rising volatility—ideal for momentum traders. A sustained move above ₹2,245 could drive the price toward the swing‑high corridor of ₹2,370‑₹2,400, provided the support at ₹2,150 holds.
Peer comparison: Infosys and TCS have remained range‑bound, making Mastek a relative winner in the IT sector.
Dalmia Bharat’s Cup‑and‑Handle: Nearing the Neckline
Dalmia Bharat (CMP ₹2,191.4) continues to form a textbook cup‑and‑handle since Oct 2025. The stock closed near the neckline at ₹2,200, and a breakout above ₹2,220 could trigger a rally to the first target of ₹2,400.
Technical confirmation: The MACD histogram turned bullish, and the RSI is climbing above 50, indicating momentum is shifting.
Historical analogue: In August 2022, Dalmia’s cup‑and‑handle breakout led to a 22 % surge over four weeks.
JK Cement’s Accumulation Range and Breakout Test
JK Cement (CMP ₹5,891.5) has been trading in a rectangular range of ₹5,361‑₹6,030 since Nov 2025. Volume spikes on Jan 20 suggest institutional accumulation.
A decisive close above ₹6,030 would likely open the path to ₹6,450, while the support at ₹5,790 guards the downside.
Sector view: Cement stocks have benefited from the government’s infrastructure push, with average volume up 18 % YoY.
Why Delhivery and Suzlon Are Poised for Short‑Term Declines
Delhivery (CMP ₹384.85) broke a box pattern on Jan 12, falling below all major EMAs (10‑, 20‑, 50‑, 200‑day). The downtrend is reinforced by lower highs/lows and a new 52‑week low.
Short‑term target: Sell futures around ₹391 with a stop at ₹398, aiming for ₹377.
Suzlon Energy (CMP ₹46.34) mirrors Delhivery’s weakness, trading below all EMAs and forming a bearish flag. A bounce to the prior support at ₹47.50 offers a sell‑the‑rise opportunity, targeting ₹45.20 and ₹43.50.
Both stocks are sensitive to macro‑risk: freight rates and renewable‑energy subsidies, respectively, remain under pressure.
Lodha Developers: Real Estate’s Continuing Downtrend
Lodha (CMP ₹979.3) confirmed a medium‑term downtrend after breaking its swing low of ₹1,035.15. The stock trades below all EMAs, with the recent low being the lowest since Dec 2023.
Sell futures on a rise near ₹1,003; stop at ₹1,051; target ₹926 over three weeks.
Sector backdrop: Real‑estate indices have lagged the Nifty by 1.8 % over the past quarter, with inventory buildup and higher financing costs weighing on prices.
Investor Playbook: Bull vs Bear Scenarios
Bull Case: If the Nifty respects the recent low and reverses, the stocks highlighted above could lead a short‑term rally. Look for breaks above the identified support levels (e.g., Britannia ₹5,660, ONGC ₹232, HDFC Life ₹705) and add to longs with tight stops.
Bear Case: A further break below the prior week’s low could deepen the negative bias, pulling the broader market down 3‑4 % over the next ten days. In that scenario, shift capital to defensive assets (gold, short‑duration bonds) and consider short positions in the weak‑trend stocks (Delhivery, Suzlon, Lodha).
Risk management remains paramount: keep position size under 5 % of portfolio per trade and use stop‑losses at the levels outlined above.