The Nifty50 started the January series on a positive note with Nifty50 rallying above 12,200 levels, and if the momentum continues ahead of the Budget the index could touch 12,400-12,500 levels based on the options data.
The benchmark indices closed on a muted note for the week ended December 27, but small & midcaps played catch up as the S&P BSE Mid-cap index rose 0.6 percent while the S&P BSE Smallcap index closed with gains of over 1 percent in the same period.
Experts are of the view that investors should track stocks that are on the verge of a break out as the momentum is likely to sustain for some more time.
“We continue with our optimistic stance on the market and expect Nifty to head towards our recent targets of 12,400 - 12,500 soon. On the downside, 12,150-12,100 has now become a sacrosanct support zone for the index,” Sameet Chavan, Chief Analyst-Technical & Derivatives, Angel Broking told Moneycontrol.
“We had a good broad-based rally in the market where few marquee large-cap names joined hands with quality mid-cap counters. It’s a sign of a healthy bull run, which we believe is likely to continue,” he said.
Chavan further added that the Santa rally in the mid-cap space is likely to accelerate now. So, traders are advised to find such potential candidates which are either on the verge of a breakout or rebounding from their supports.
We spoke to various analysts and here’s a list of stocks which they think have upside potential and are good breakout buys:
Expert: Dharmesh Shah, Head Technical at ICICI Direct.com
State Bank of India: Buy| LTP: Rs 337| Target: Rs 360| Stop Loss: Rs 324| Upside 7%
The stock is on the verge of resolving out of long-term (10-Years) Ascending Triangle breakout signaling structural improvement.
The stock in the last two weeks has formed a strong base at the bullish gap area of 13th December (321-325) and is set to resume fresh up move towards 360 levels in the coming weeks being the 123.6% external retracement of the recent decline (351-308).
Hindalco: Buy| LTP: Rs 215.40| Target: Rs 230| Stop Loss: Rs 209| Upside 7%
A falling channel breakout containing the last two years price action suggests the end of a corrective phase and resumption of a fresh uptrend.The last week's consolidation has helped the stock to work off the overbought condition in daily stochastic. We expect the recent breakout area of 210 will act as immediate support and the stock is expected to head towards 230 levels in the coming weeks as it is the 80% retracement of the previous decline (245-171).RPG Life: Buy| LTP: Rs 312| Target: Rs 340| Stop Loss: Rs 296| Upside 9%
Price breakout above 14-months consolidation range (288-152) was supported by strong volume and a faster retracement signals a structural change in the trend.
It took a breather last week that helped the stock to work off the overbought condition in daily stochastic and is currently placed at trendline support joining lows since 25th October 2019 (194).
We believe that the stock is likely to resume fresh up move and head towards 340 levels in the coming weeks as it is the 138.2% external retracement of the entire November 2019 decline (319 to 264).
Expert: Ajit Mishra, VP Research, Religare Broking
Bata India: Buy| LTP: Rs 1712| Buying Range: Rs 1690-1700| Target: Rs 1750| Stop Loss: Rs 1675| Upside 2%
Bata India has retraced marginally after making a record high at 1,814 and is currently consolidating in a narrow range while holding firmly above the support zone of 100-Days EMA on the daily chart.
Indications are in the favor of a fresh breakout in the near future. We advise initiating fresh longs as per the given levels.IndusInd Bank Ltd: Buy| LTP: Rs 1523| Buying Range: Rs 1510-1515| Target: Rs 1550| Stop Loss: Rs 1495| Upside 2%
In the banking space, private banking majors are leading from the front and are still looking buoyant. Post breakout from its consolidation range, IndusInd Bank has taken an intermediate pause, offering a fresh buying opportunity. We advise accumulating fresh longs in the given range.PVR Ltd: Buy| LTP: Rs 1884| Buying Range: 1855-1870| Target: Rs 1960| Stop Loss: Rs 1820| Upside 4%
PVR has been consolidating within a range of 1710-1900 for the last three months. It has surged strongly on December 27 and reached closer to the upper band of that range which also coincides with its record high.
The chart pattern and positioning of the indicators are pointing towards a strong possibility of a breakout in the near future. We thus suggest traders using this chance and initiate fresh longs in the mentioned level.
Expert: Rajesh Palviya, Head -Technical & Derivative Research, Axis Securities Ltd
L&T Finance Holding: Buy| LTP: Rs 118| Buying Range: Rs 119-117| Target: Rs 132| Stop Loss: Rs 113| Upside 11%
The stock has witnessed a resumption of the uptrend on the daily chart. Since the past four weeks, the stock is sustaining above its 200-Days SMA (112) which remains a positive sign. The daily and weekly indicators are in supportive mode.MindTree Ltd: Buy| LTP: Rs 787| Buying Range: Rs 790-780| Target: Rs 830| Stop Loss: Rs 765| Upside 5%
Currently, the stock is sustaining above its weekly breakout zone of 760 indicating bullish sentiments. It is also sustaining above its 20, 50 100 and 200-Days SMA which supports positive bias ahead.Manappuram Finance: Buy| LTP: Rs 176| Buying Range: Rs 176-174| Target: Rs 190| Stop Loss: Rs 169| Upside 8%
On the daily chart, the stock is sustaining above its daily breakout level of 170 indicating bullish sentiments.
The stock is sustaining above its 20, 50, 100-Days SMA which supports upside rally. Daily and weekly indicators are in positive mode indicating strength ahead.Expert: Sameet Chavan, Chief Analyst-Technical & Derivatives, Angel Broking
Indoco Remedies | Buy | LTP: Rs 180.20 | Target price: Rs 211 | Stop loss: Rs 162 | Upside: 17%
After a long time, the mid-cap stocks have finally joined the bull’s party and showed outperformance during the week gone by.
This mid-cap stock, after gyrating in a broad range of Rs 135-175 for the last five months, has finally broken the range on the higher side, confirming a ‘rectangular channel’ breakout.
In addition, prices on the daily chart have also closed above the 'super trend' indicator which acted as stiff resistance four times in the last few months.
Moreover, we are also witnessing a fresh bullish crossover with 50-EMA crossing 89-EMA from below, supporting the buy call.
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