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Last Updated : Apr 16, 2018 10:40 AM IST | Source:

Buy JSPL for the short-term with a target price of Rs 270/share: Technical analyst

“Traders and investors may again find attractive buying opportunities in terms of risk-reward ratio if the Nifty comes down to 10,420 levels.” says Jaydeb Dey, Technical Analyst at Stewart & Mackertich Wealth Management Ltd.

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Jaydeb Dey

The Nifty ended Friday up 0.21% at 10,480.60. It continued to oscillate in the price band of 10,450 to 10,520 for the entire session before ending the last day of the week with a bearish spinning top candle.

However, the benchmark index closing above 10,420 is a positive development and brightens the possibility of a further up-move towards 10,570 levels. It ended up 1.44% on a week-on-week basis. Continuation of previous week’s bullish momentum was seen throughout last week, except consolidation around 10,420 for a couple of days, before making a weekly high of around 10,520.

The Nifty continues to hit higher highs with higher lows on the weekly chart, which implies that this uptrend is likely to push towards pivotal resistances placed around 10,570. Also, the bulls might get vivified seeing the bullish body candle for the third consecutive week. Hence, traders and investors may again find attractive buying opportunities if the Nifty dips to 10,420-10,350 levels.

On the hourly chart, the Nifty is trading well above all crucial moving averages. Hence, dips towards 10,420 might be a decent buying opportunity for the next leg of the upmove towards 10,570.

Nifty patterns on multiple timeframes shows that it broke out of its 38.2% Fibonacci retracement level, placed around 10,420 of the entire correction from the all-time high to its recent low of around 9,950, and settled above that level on the weekly chart. Hence, the next upmove towards 10,570 is likely.

On Friday, the Bank Nifty ended up 0.02% at 25,200.60. Its downside pivotal support is placed around 24,950. Major upside resistance is seen around 25,400 levels.

Based on thorough technical study, we recommend JSPL which can deliver up to 5% return in the short-term:

Jindal Steel & Power | Rating: Buy | Target: Rs 270, stop loss: Rs 235 | Return: 10%

The stock ended the week with a down trending channel breakout. Ending above Rs 245 is a sign of strength, which may continue further towards Rs 270 levels. 13-30 EMA bullish crossover on the daily chart is another evidence in favour of our bullish argument.

Based on above mentioned observations, we recommend a buy on JSPL on dips for the short-term with an upside target of Rs 270 per share.

Disclaimer: The author is Technical Analyst at Stewart & Mackertich Wealth Management. The views and ideas expressed above may have been suggested to the clients of Stewart & Mackertich Wealth Management. It is advised that investors/traders should consult with their certified experts before taking any investment decision.
First Published on Apr 16, 2018 08:12 am
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