The market failed to hold on to its record high due to selling pressure at higher levels, and declined sharply on May 3, as a result of which the Nifty 50 closed last week with just 0.25 percent gains. In fact, the index failed multiple times to surpass 22,800 since April, indicating the strong hurdle going ahead as surpassing and sustaining above the same can only open doors for the upper band of rising channel placed at around 22,950-23,000 levels, experts said.
On the lower side, 22,350-22,300 is the immediate key support. If the index breaks the same support, then 22,200 is the level to watch. Further, the increasing volatility also pointed towards an uncomfortable scenario for bulls as India VIX, the fear gauge, jumped 43 percent in the last seven sessions to the 14.62 levels.
For the week, the Nifty 50 was up 56 points at 22,476 and formed a Doji candlestick pattern on the weekly charts with continuation of higher highs, higher lows for yet another week, while on the daily charts, there was Bearish Engulfing candlestick pattern formation, the bearish reversal pattern.
"For now, the immediate swing low of the 22,350-22,300 subzone is likely to provide a firm cushion for any intra-week blip, followed by the 50 DEMA (days exponential moving average) of 22,230 and the bullish gap around the 22,200 zone," Osho Krishan, senior analyst - technical & derivative research at Angel One said.
On the higher end, the record-high zone of 22,750-22,800 seems daunting for the bulls and until the market witnesses a decisive breakthrough, the next leg of rally toward the 23,000 mark seems demanding, he feels.
Ashish Kyal, Founder and CEO of Waves Strategy Advisors also feels it is not going to be easy for bulls to take Nifty back above 22,800 immediately. "On the downside 22,350 is immediate support. Any breach below 22,350 will be a bearish sign."
Moneycontrol collated a list of top 10 stock ideas from experts with a 3-4 weeks perspective. The closing price of May 3 is considered for calculation of stock price return:
Expert: Amol Athawale, VP-Technical Research at Kotak Securities
Container Corporation of India: Buy | LTP: Rs 1,059 | Stop-Loss: Rs 1,020 | Target: Rs 1,140 | Return: 8 percent
On the daily scale, after the robust up move the stock is trading in a sideways movement forming a Flag chart pattern. The stock is representing a bullish continuation chart structure which indicates that a new leg of up move is likely to resume from the current levels on the coming horizon.
Jubilant Foodworks: Buy | LTP: Rs 463 | Stop-Loss: Rs 444 | Target: Rs 490 | Return: 6 percent
Post decline from the higher levels, the counter rebounded from its demand zone and witnessed a steady recovery from the lower levels. Additionally, on the weekly charts, the counter has given a breakout from its sloping channel formation. The up moves in the counter suggest a new leg of bullish trend from the current levels.
BHEL: Buy | LTP: Rs 305 | Stop-Loss: Rs 292 | Target: Rs 330 | Return: 8 percent
On the daily and weekly charts, the counter is into a rising channel chart formation with higher high and higher low series pattern. Additionally, the technical indicator ADX (average directional index) is also indicating further up trend from current levels which could boost the bullish momentum in the near future.
As long as the stock is trading above Rs 292, the uptrend formation is likely to continue. Above which, the counter could move up to Rs 330.
Expert: Riyank Arora, Technical Analyst at Mehta Equities
JSW Steel: Buy | LTP: Rs 874 | Stop-Loss Rs 860 | Target: Rs 925 and Rs 950 | Return: 9 percent
The stock witnessed an ascending triangle breakout on April 25, 2024, on its daily timeframe charts. With the price pulling back and undergoing a re-test of its trendline support level, the overall risk-reward ratio looks favourable at current levels.
With the RSI (relative strength index) around 53.35 and ADX near 21.25, it is expected that the stock should pick up momentum in the upcoming trading sessions. A strict stop-loss can be kept near the Rs 860 mark for potential upside targets of Rs 925 and Rs 950.
Tata Consumer Products: Buy | LTP: Rs 1,094 | Stop-Loss: Rs 1,070 | Target: Rs 1,180 | Return: 8 percent
The stock is consolidating well between its anchor VWAP (volume-weighted average price) resistance mark of Rs 1,120 and support mark of Rs 1,075. With the RSI near 40.66 and ADX near 22.95, showing a minor increase from lower levels of 15, it is expected that momentum should pick up strength, and the stock should witness a breakout above the Rs 1,120 mark.
We can expect targets of Rs 1,180 and Rs 1,200, with a strict stop-loss set at Rs 1,070 mark.
GMR Airports Infrastructure: Buy | LTP: 85.60 | Stop-Loss: Rs 83 | Target: Rs 95 | Return: 11 percent
The stock has successfully touched its anchor VWAP support mark of Rs 85 on its daily time frame charts. With the RSI near 53.51 and ADX at 20.20, the overall momentum looks strong, and the stock might head towards a target of Rs 95 and above.
The stop-loss should be kept at Rs 83 for all long positions to manage risk well. A strong technical structure with tight volatility contraction between AVWAP (anchored volume weighted average price) makes it a good candidate.
Expert: Om Mehra, Technical Analyst at Samco Securities
Torrent Pharma: Buy | LTP: Rs 2,735 | Stop-Loss: Rs 2,600 | Target: Rs 2,950 | Return: 8 percent
Torrent Pharma has experienced a period of solid consolidation, culminating in a significant breakout above the critical resistance level of Rs 2,700. The stock holds above its short-term (20-day) and medium-term (50-day) moving averages.
The sharp rise in volumes with price, indicates that bullish momentum is likely to persist. Further validating this upward momentum, the RSI is holding above the 60 level.
Hence, based on the above technical structure, one can initiate a long position at CMP Rs 2,735 for a target price of Rs 2,950. The stop-loss can be kept at Rs 2,600.
Thermax: Buy | LTP: Rs 4,767 | | Stop-Loss: Rs 4,590 | Target: Rs 5,100 | Return: 7 percent
Thermax is forming higher highs and higher lows indicating a sustained uptrend. It is trading comfortably above its short-term (20-day) and medium-term (50-day) moving averages. The RSI is comfortably holding at 66 and is steadily rising.
The stock is holding the Rs 4,700 levels which previously served as minor resistance, indicating buying interest among short-term traders.
Hence, based on the above technical structure, one can initiate a long position at CMP Rs 4,767 for a target price of Rs 5,100. The stop-loss can be kept at Rs 4,590.
Expert: Nagaraj Shetti, Senior Technical Analyst at HDFC Securities
Welspun Corp: Buy | LTP: Rs 601 | Stop-Loss: Rs 555 | Target: Rs 660 | Return: 10 percent
The stock price has bounced back decently after the downward correction in the previous week. Currently, the stock price is in an attempt to break above the larger range movement of around the Rs 590-600 levels. Hence, a sustainable move above the Rs 600-610 levels is likely to bring sharp upside momentum for the stock price ahead.
Volume has started to expand during upside breakout in the stock price and weekly 14 period RSI shows positive indication. Hence, one may expect further strengthening of upside momentum in the stock price ahead.
Buying can be initiated in Welspun Corp at CMP (Rs 601), add more on dips down to Rs 575, wait for the upside target of Rs 660 in the next 3-5 weeks. Place a stop-loss of Rs 555.
UPL: Sell | LTP: Rs 494 | Stop-Loss: Rs 525 | Target: Rs 455 | Return: 8 percent
The stock price has been in an intermediate downtrend over the last many months. We observe a negative chart pattern like lower tops and bottoms over the period of time, as per the weekly timeframe chart.
The recent upside bounce in the stock price seems to have completed and the stock price is now ready to decline from the lower highs around Rs 510 levels. The daily and weekly RSI are showing negative indication there by reiterating our negative view for the stock price for coming weeks.
One may look to sell UPL at CMP (Rs 494), add more on rise up to Rs 510 and wait for the downside target of Rs 455 in the next 3-5 weeks. Place a stop-loss of Rs 525.
Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
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