SENSEX NIFTY
Jul 20, 2013, 01.42 PM IST | Source: CNBC-TV18

Hemant Thukral's F&O strategy: Buy Bajaj Auto; sell BHEL

In an interview to CNBC-TV18, Hemanth Thukral recommends buying Bajaj Auto keeping a stop loss of Rs 1920 and a target of Rs 2070 and selling BHEL keeping a stop loss of Rs 190 and a target of Rs 163

Hemant Thukral

National Head- Derivative Desk

Expertise : F&O

More about the Expert...

Hemant Thukral, National head- Derivative Desk, Aditya Birla Money shares his view on the futures and options market and his strategy for the coming week. In an interview to CNBC-TV18, Thukral said he is bullish on Bajaj Auto as interest in the two-wheeler space has re-emerged. He recommends buying the stock keeping a stop loss of Rs 1920 and a target of Rs 2070.

Also Read: Won't resort to huge discounts to boost sales: Bajaj Auto

However, he is bearish on Bharat Heavy Electricals (BHEL) and suggests selling the stock keeping a stop loss of Rs 190 and a target of Rs 163.

Below is his F&O strategy for Bajaj Auto and BHEL.


On Bajaj Auto
 
The first of the weekly strategies is Bajaj Auto. In two wheeler stocks on Friday, a lot of buying interest has re-emerged. Both Hero Motors and Bajaj Auto have added huge open interest on the long side, especially Bajaj Auto where 16 percent open interest has been added up.

Technically, the stock has managed to cross 200 DMA convincingly which is in the range of Rs 1885-1889. Also the stock has managed to close above the recent highs of Rs 1920-1925 which was acting as a resistance for this stock. In the immediate short term that stock should go ahead and retest the next resistance zone which is around Rs 2050-2070. So, we recommend going long on Bajaj Auto keeping a stop loss of Rs 1920 and a target of Rs 2070 on the same.

On BHEL

Second weekly stock strategy is a sell call on large cap capital goods Bharat Heavy Electricals (BHEL). It has been a complete disappointment. The stock has managed to cross 200 daily moving average (DMA) and was touching a resistance zone of Rs 190. However, on Friday we have seen a complete U-turn in sentiment.

Around 20 percent positions have been added up on the short side. Not only has the stock not been able to manage to cross Rs 190, on the downside it has given away the strong support of 200 DMA which is around Rs 183-182. So, in the immediate short term we expect BHEL to retest the recent lows formed around Rs 163-165.

So, we recommend going short on BHEL keeping a stop loss of Rs 190 and a target of Rs 163.

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