Nifty FMCG witnesses profit booking after hitting new record: Here's what chartist say?

Even as benchmark indices traded steady with negative bias, Nifty FMCG in trade today marked a fresh record high. Nevertheless, in line with the headline indices it succumbed to profit booking and last towards the close of the session was down over 1 per cent.

In intraday trade, Nifty FMCG index scaled a new high of 63,805.95, led by gains in stocks including Emami, United Breweries, Nestle, Godrej Consumer and Jubilant FoodWorks.

The gains in the index have been continuous as analysts remain upbeat on the sector after solid earnings were reported from the space in the June quarter.

Here's how technicals suggest for Nifty FMCG index

Aditya Agarwal, Head of Derivatives and Technical at Sanctum Wealth said, Nifty FMCG index has been consolidating in broad range of 61000-63000 level and has finally given a breakout on the higher side. Overall, long term structure for FMCG index looks positive and it is expected to move towards 65400/66200 levels. Any correction in Nifty FMCG index towards 63800/62400 can be used to add fresh long positions in FMCG stocks.

The Nifty FMCG index has scaled a new all-time high, indicating a resilient trend in the progress. The index has gained over 2 per cent so far, post surging 11 per cent last month. The current momentum has a support of 62500, with price action aiming to reach 65000. 

Unless the trend breaks 60000 mark, the optimistic bias is said to continue at higher levels. The trend remains accumulative over 60000 mark. There is divergence on charts despite entering in the overbought category, noted  Avdhut Bagkar, Derivatives & Technical Analyst, StoxBox.

What should investors do?

Agarwal suggested that every dip should be bought into. Our top picks from FMCG space will be Hindunilvr, Tata Consumer, GodrejCP and Emami, he added.