"The immediate resistance for the Nifty is placed at 10,735. If the index crosses above this level then the next target is seen at 10,800-10830," says Ashish Chaturmohta of Sanctum Wealth Management.
Equity market started the week on a positive note with a gap up opening, continuing the positive momentum for the third straight day. Fall in crude prices and bounceback in the rupee aided market sentiment. The Nifty closed Monday at 10,689, up 0.8 percent for the day. The BSE Midcap and Smallcap indices gained 1.35 percent and 1.6 percent, respectively, outperforming the benchmarks.
Immediate resistance for the index is placed at 10,735, its 61.8% Fibonacci retracement of the recent move from 10,929 to 10,418. If the index crosses above this level, then the next target is seen at 10,800-10830. On the downside, support is seen at 10,625-10,600 levels. If the index sustains above this level, it will take the index towards 10,800 levels.
Significant put open interest addition was seen in strike prices – 10,600, 10,650 and 10,700 which suggests writing activity is likely to act as support for the market. In call options, highest open interest remains at 10,800, which is likely to act as crucial resistance for the market.
Here is a list of top five stocks that could deliver 10-14% return in the short term:
Havells India: Buy| CMP Rs 563 | Stop loss: Rs 545 | Target: Rs 620 | Return 10%
The stock hit a high of Rs 592 in the month of January this year and then witnessed a sharp fall to Rs 450 levels. Since then, the price has retraced more than 78.6 percent of the decline in a stepped manner.
For the last six-weeks price had been consolidation mode and taken support at rising trendline connecting lows of Rs 450 and Rs 484. The stock has seen a breakout from this range bound action with good price momentum and high volumes on Monday.
The price has also given breakout from Bollinger band with the expansion of band and closed above upper band suggesting upper is likely to trend in the direction of the breakout.
The daily MACD has given positive crossover on the daily chart above neutral level of zero suggesting consolidation phase is over and the uptrend is resuming.
Thus, the stock can be bought at current level and on dips to Rs 556 with a stop loss below Rs 545 and a target of Rs 620 levels.
JMC Projects (India): Buy | CMP: Rs 685 | Stop loss: Rs 650| Target: Rs 780 | Return 14%
After falling from January high of Rs 688, the stock managed to hit all-time high from low of Rs 445 level. Any shallow dips in the last couple of months have been supported at 21-day exponential moving average and price is trending higher.
After consolidating in the last month around its all-time high, the stock is showing signs of breakout on the upside. The price has also given breakout from Bollinger band with the expansion of band and closed above upper band suggesting upper is likely to trend in the direction of the breakout.
Daily MACD has given positive crossover on the daily chart above neutral level of zero suggesting consolidation phase is over and the uptrend is resuming. Thus, the stock can be bought at current levels and on dips to Rs 670 with a stop loss below Rs 650 and a target of Rs 780 levels.
Indian Hotels Company: Buy | CMP: Rs 143 | Stop loss: Rs 134 | Target: Rs 170 | Return: 18%
On the long-term monthly charts, the stock has major W-shaped bottoming pattern seen between Rs 135 and Rs 30 odd levels over a period of the last ten years.
In the month of January, the price breakout was seen from the pattern to touch an all-time high of Rs 161 levels and then corrected down to Rs 125 levels where it found support at 100-day moving average.
The recent correction from Rs 156 levels has again found support at 100-DMA and the stock has witnessed a bounce back in the last session. Rallies in the stock have been on good volumes and decline on below-average suggesting market participants holding on the stock.
Thus, the stock can be bought at current level and on dips up to Rs 142 with a stop loss below Rs 137 and a target of Rs 170 levels.
Pfizer: Buy | CMP: Rs 2,445 | Stop loss: Rs 2,350 | Target: Rs 2,800 | Return 14%
After almost two years of consolidation between Rs 2,050 and Rs 1,600 odd levels, the stock witnessed a breakout to touch high of Rs 2,370 levels.
The pullback tested the breakout and price rallied to touch high of Rs 2,550 this month. For the last few weeks stock has been consolidating its gains in a narrow range.
Price has taken support at a 21-day exponential moving average which has been acting as support for the on declines. The relative strength index (RSI) has given positive crossover on the daily chart.
Thus, the stock can be bought at current level and on dips to Rs 2,400 with a stop loss below Rs 2,350 and target of Rs 2,800 levels.
Exide Industries: Buy | CMP: Rs 261 | Stop loss: Rs 249 | Target: Rs 290 | Return: 11%
The stock has formed a rounding bottom pattern over the last one year between Rs 250 and Rs 195 odd levels. At the start of this month, it witnessed a breakout from the same on huge volumes and price momentum touched an all-time high of Rs 270.
Since then the price has corrected on below-average volumes to Rs 242 and then saw a huge bounce back. The price moved above the short-term 21-day exponential moving average. Relative strength index has given positive crossover on the daily chart. Thus, the stock can be bought at current level and on dips to Rs 256 with a stop loss below Rs 249 and a target of Rs 290 levels.Disclaimer: The author is Head Technical and Derivatives, Sanctum Wealth Management. The views and investment tips expressed by investment expert on Moneycontrol.com are his own and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.