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Last Updated : Dec 14, 2017 10:12 AM IST | Source: Moneycontrol.com

Buy the dip towards 10,000; top 4 stocks which could give up to 18% return in short term

Any dip near 10,000 levels will be a good buying opportunity for the buyers whereas traders can create fresh long positions above 10350 levels.

 
 
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Rohit Singre

Bonanza Portfolio

The volatile session of Wednesday ended with a loss of 47 points. Post lunch, profit booking dragged the index to the day’s low and closed the day at 10,192.95.

Technically, the index is trading in a downtrend channel on the daily charts. Recently, Nifty took the support at the lower band of the channel (10,230) and bounced quickly towards 10,340 which is an upper band of the channel.

The index started correcting from the upper band of the channel (10,340) which is making a cautious view again. The Nifty has strong support near 10,090 and 10,000 levels and on the higher side, immediate resistance is coming near 10,350.

If the index manages to break above 10,350 then we may see a strong short covering rally in the index which could extend the rally towards 10600 levels in the near term.

On the options front, highest open interest stands in 10,000 PE which will act as a strong support in December series and on the higher side 10500 CE has the highest open interest acting as a first strong hurdle in the December series.

Any sudden rally in the market will result in a strong short covering rally because overall structure still looks positive. We expect markets to be more volatile in the near term ahead of Gujarat election verdict.

Any dip near 10,000 levels will be a good buying opportunity for the buyers whereas traders can create fresh long positions above 10350 levels.

Here is a list of four stocks which can give up to 18% return in short term:

Sun TV: BUY | Target Rs 1050| Stop Loss Rs 850| Upside 15%

The stock is trading in a rising channel pattern and has been forming the higher top and higher bottom formations on the daily chart. In the Wednesday’s session, the stock has given a strong price and volume breakout which suggest that it is set to touch fresh highs in the short run.

On the weekly charts, it seems that the stock has given a bullish flag breakout with good volumes and has also formed rounding bottom pattern. The momentum indicator such as relative strength index (RSI) currently reading at 63 on the weekly chart is bullish in nature.

Considering technical structure, traders can initiate buy call on the stock at current levels and to any dip near Rs900 for the target of Rs1050 with a stop loss below Rs850 on a closing basis.

Hindustan Copper: BUY | Target Rs 100-110 | Stop Loss Rs 85| Upside 18%

The stock has given a tremendous return in the month of November from Rs70 to 110 but soon came under selling pressure but has now formed a base near Rs88.

If we look at current chart structure, the stock has taken support twice near Rs88 zone and has bounced sharply from that level.

In Wednesday’s session, the stock rose more than 5 percent after taking support at Rs88 with strong volume hinting it can move towards Rs100 levels in the short run.

If it manages to hold above Rs100 then we may see a quick up move up to Rs110 in the near term. The momentum traders can initiate a long call on the stock at current levels to any dip near Rs91 for the targets of Rs100 & Rs110, keeping a stop loss below Rs85 on closing basis.

Inox Leisure: BUY | Target Rs 310-320 | Stop Loss Rs 265| Upside 10%

On the weekly charts, the stock is trading in a rising channel pattern forming the higher top and higher bottom which is bullish in nature.

On the daily chart, we have seen a good up move after the double bottom breakout seen in early November. Recently, the stock broke from its bullish flag pattern with very good volumes hinting it is going to continue its short-term uptrend and may touch Rs310-320 in the near term.

Traders can take a position in the counter at current levels to any dip near Rs280 for the target of Rs310 and 320. A stop out levels can be kept below Rs265 on a closing basis.

Motilal Oswal: BUY | Target Rs 1520-1600| Stop Loss Rs 1240| Upside 16%

The stock is trading at a supper uptrend and we have seen a strong up move in counter in the recent time. On charts, after every rise, the stock has shown some healthy correction and then bounced aggressively.

The current chart structure is reflecting a similar move. After a strong rally, the stock came to previous breakout level placed at Rs1300 and started showing strength.

We expect the current strength in the stock to continue which will extend further to push the stock towards Rs1520-1600 levels in the short run.

Considering technical setup, traders can accumulate the stock at current levels to any dip near Rs1320 for the targets of Rs1520 and Rs1600 with a stop loss below Rs 1240 on a closing basis.

Disclaimer: The author is Senior Research Analyst, Bonanza Portfolio Ltd. 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.
First Published on Dec 14, 2017 10:12 am
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