Mitesh Thacker's top 5 picks for trade today

Q: What about midcap IT? There is continuing strength in stocks like Patni and NIIT Technologies ?

A: It still remains good; in fact, the entire sector has been outperforming the markets. However, if you are a very short-term trader, we are seeing signals of weakness or if not at least weakness the uptrend looking tired a bit on the momentum indicator. So IT as an entire sector including the largecaps as well as the midcaps probably will see some kind of gains being shed off for the next few days and get into some kind of a consolidation mode.

Q: There has been quite some damage for some of the sugar stocks; Balrampur Chini is down about 12% in three days. What do you see on those charts Balrampur Chini , Bajaj Hindusthan and Shree Renuka Sugars ?

A: These stocks were in a good uptrend on weekly and monthly charts but what we are seeing is a broader and a deeper corrective movement which could be likened to a short-term downtrend. For a stock like Balrampur Chini Rs 120 looks like the first target but overall the stock price and the indicator suggests that it could even go down to as low as Rs 111. So there is some downside in all these stocks. You will see these stocks under pressure. Of course, there is the issue of negative news flow happening on these stocks, but overall 10% correction could be very possible for a stock like Balrampur Chini and Bajaj Hindusthan. Shree Renuka Sugars could fall down around 5-8%.         

Q: What do you think? It will be one more of those days where we start soft and then actually add some by the end of the trading day?

A: I think it could be. The fact that we have broken out of 5,050-5,070 now suggests lot of strength. So as long as the market doesn't break below 5,050 in intraday dips like this wherein the Nifty drops by around 20-25-30 points should be use to take long positions. So I would advice buying around 5,070-5,080 mark with a stop below 5,050. 

Q: Anything you like from auto ancillaries right now broadly that space?

A: I think on trading basis you do keep getting these kinds of breakouts in smaller stocks but our coverage is mostly limited to largecap futures stocks.    

Q: Have you taken a look at GMDC's chart?

A: The stock was buzzing yesterday. There is good enough upside left in the stock. Rs 150-160 could be a good short-term target. On overall the weekly charts looks very strong, so on dips around Rs 120-118 will be an excellent buying opportunity for the stock for somebody who has two-three months kind of horizon.

Q: You were talking about some of the midcap IT stocks but specifically on NIIT Technologies how do the chart looks?

A: That one looks stronger compared to other midcap stocks. The stock has been making higher tops and higher bottoms and there are no signs of weakness or distribution emerging. The uptrend remains intact, very much in force. So Rs 180-190 will be a good target for a couple of weeks but overall the stock has the potential and the price pattern to go even higher. 

Q: What about the metals pack? How do you approach that now Tata Steel , Hindalco and SAIL ?

A: The steel stocks look better in the entire space of metal stocks. Tata Steel probably looks like set to test levels of around Rs 590 to around Rs 600, SAIL has given a fresh breakout; it just made a new 52 week high above Rs 190-194. I think Rs 210 could be a good short-term target while the upside would be capped because there are historical weekly supply areas coming up for these kind of stocks. They will continue to do better, and probably, lead the upside in the index.