Jigar S Patel, Senior Manager - Equity Research at Anand Rathi
Finally, after struggling for four consecutive months, the bulls were back in action during April 2023. Although the previous month was highly choppy, but this month provided a dominant move on the upside.
The index Nifty spot gained over 4 percent from previous month's close to recapture the 18,000 landmark. The domestic markets outperformed the global markets mainly due to the decent earning season so far and the absence of any negative triggers bolstered the sentiments.
The index confirmed a breakout from its previous swing high of 17,800. The overall theoretical target for the breakout comes to around 18,200 – 18,400 and support is expected at around 17,800 followed by 17,700.
Meanwhile, the Nifty Bank index outperformed the benchmark indices by surging around 5.84 percent during the current month. During this process, the index has managed to clear the supply zone of 42,000 and is now approaching the 43,500 mark.
The zone of 43,500 – 44,000 has a couple of previous swing highs and that can act as a hurdle for the index. Also, the golden ratio i.e., 161.8 percent retracement of the previous is around 43,500. Thus, even in Nifty Bank, we are witnessing some early red flags which hint towards caution. On the downside, 42,000 – 41,000 are the support zone for the coming weeks.
Here are three buy calls for the next three weeks:
Wipro: Buy | LTP: Rs 385 | Stop-Loss: Rs 365 | Target: Rs 420 | Return: 9 percent
Recently the stock has seen bullish divergence on a daily scale, the price was making lower lows, but RSI (relative strength index) was making higher lows. Since then, the counter has reversed nicely from the lower level of Rs 360 approximately.
And currently, it is trading well above its previous swing high of Rs 379. One can buy Wipro here with an upside of Rs 420 and the stop-loss would be Rs 365 on a daily close basis.
MOIL: Buy | LTP: Rs 156.7 | Stop-Loss: Rs 148 | Target: Rs 170 | Return: 8.5 percent
In the previous trading session, MOIL sustained above its crucial support of Rs 150. Additionally, it is trading above William Alligator on a daily scale which is looking lucrative (refer to the chart). Daily RSI has rebounded from 50 levels thus making it a buy candidate.
One can buy in the range of Rs 155-157 and the target is Rs 170. The stop-loss would be Rs 148 on a daily close.
Reliance Industries: Buy | LTP: Rs 2,420.5 | Stop-Loss: Rs 2,350 | Target: Rs 2,500 | Return: 3.3 percent
Since last month approximately, the said counter has seen a nice up move from Rs 2,200 to Rs 2,400 levels. On a daily scale, it has sustained above William's alligator (trend following indicator) which is looking lucrative.
Thus, one can accumulate Reliance Industries in the range of Rs 2,415-2,425 for an upside target of 2,500 and the stop-loss would be Rs 2,350 on a daily close basis.
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