Ashish Chaturmohta Sanctum Wealth Management
The Nifty rallied in the latter half of Monday to close at 11,085, up 0.68 percent. The weekend cut in the Goods & Services Tax in over 100 items and recovery in the rupee-dollar boosted market sentiment.
The breadth was positive with a 2:1 ratio on the NSE. The BSE Mid and Smallcap indices outperformed with a gain of 1.3 percent and 0.9 percent for the day. The Nifty has been trading in a range of 10,920-11,080 for the last eight sessions.
In Monday’s session, the index managed to close above this range giving a breakout on the upside. If it sustains above 11,080 levels, one can expect the index to test its all-time high of 11,172 and then 11,230 levels.
On the downside, immediate support is seen at 11,000 and 10,920 levels. In Nifty options, maximum open interest (OI) is at 11,000 put and significant call writing was seen in 11,000 and 11,100 strikes suggesting that the market has support at lower levels.
Here is a list of 5 stocks that could return 6-17% in the next 1-2 months:
Maruti Suzuki India: Buy| CMP: Rs 9,701| Stop Loss: Rs 9,400| Target: Rs 10,700| Return 10.3%
The stock is in major long-term uptrend forming higher tops and higher bottoms. In the month December 2017 stock hit high of 9996 and then corrected down to 8255 levels. Looking at weekly chart stock has formed a double bottom pattern.
The rally from lower levels has been on above average volumes and long bullish candles indicating buying participation in the stock. For the last couple of weeks, the stock had been trading in a narrow range and formed bullish pole and flag pattern above the double bottom breakout level.
On Monday, the stock witnessed strong momentum and good volumes given a breakout from flag pattern. Daily MACD line has given positive crossover with its average suggesting start of a fresh uptrend in the stock.
Thus, the stock can be bought at current levels and on dips to 9600 with a stop loss below 9400 for a target of 10500 levels.
Endurance Technologies: Buy| CMP: Rs 1,305| Stop Loss: Rs 1,250| Target: Rs 1,450| Return 11%
The stock was long-term uptrend forming higher tops and higher bottoms from 518 in November 2016 to 1400 in January 2018. Since then the stock has been trading in a range and consolidating its gains.
It has formed a symmetrical triangle pattern which is generally expected to give in the direction of the previous trend. The last couple of sessions have witnessed bounce back from 200 day moving average with price momentum and high volumes.
Price has given breakout from Bollinger band on the upside with the expansion of band suggesting a continuation of the trend in the direction of the breakout. MACD line on the daily chart has given positive crossover with its average and on weekly chart turning up from equilibrium levels.
Thus, the stock can be bought at current levels and on dips to 1290 with a stop loss below 1250 for a target of 1450 levels.
Page Industries: Buy| CMP: Rs 28,514| Stop Loss: Rs 27,500| Target: Rs 30,300| Return 6.2%
The stock is in uptrend forming higher tops and higher bottoms on the daily chart for last six months. Rallies have been by good volumes while declines have been on below-average volumes indicating buying in the stock and market participants holding onto the stock.
On the daily chart, 20-days moving average is acting as support and resistance for the stock. From the recent high of 29,676 levels, the stock has again taken support at 20DMA. Thus, it can be bought at current levels and on dips to 28300 with a stop loss below 27500 for a target of 30300 levels.
Voltas: Buy| CMP: Rs 574| Stop Loss: Rs 550| Target: Rs 640| Return 11.5%
The stock had seen a sharp decline from high of 665 in the month of April this year to a low of 493. Low was formed on high volumes and long ranged bar suggesting value buying coming at lower levels.
The stock has formed a rounding bottom pattern between 560 and 493 odd levels on the short-term daily chart. Price has given breakout from Bollinger band on the upside with the expansion of band suggesting a continuation of the trend in the direction of the breakout.
Daily MACD has moved above neutral level of zero suggesting bottoming process is complete and the stock likely to see the start of a new uptrend. Thus, the stock can be bought at current levels and on dips to 570 with a stop loss below 550 for a target of 640 levels.
Pidilite Industries: Buy| CMP: Rs 1,050| Stop Loss: Rs 1,010| Target: Rs 1,190| Return 17%
The stock is in long-term uptrend forming tops and higher bottoms on the weekly chart. After touching high of 1195 in the month of May, stock corrected down to 1019 levels. Here price has taken support at 50% retracement of the rise from 845 to 1195.
Also, the price has taken support at 89-day exponential moving average and holding above it. Relative strength index has given positive crossover with its average on the daily chart.
Thus, the stock can be bought at current levels and on dips to 1040 with a stop loss below 1010 for a target of 1190 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.
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