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Experts say avoid aggressive bets: Top 10 short-term buy/sell ideas for the next 3-4 weeks

The overall trend has been strongly bullish, even if the correction comes. Traders are advised to stay light and avoid aggressive leveraged positions.

January 18, 2021 / 09:53 AM IST
 
 
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Indian market fell in the second half of the past week but it managed to close in the green. The S&P BSE Sensex rose 0.5 percent while the Nifty50 was up 0.6 percent for the week ended January 15 but the bigger cut was seen in the broader market.

The S&P BSE Midcap and Smallcap index were down more than 1.2 percent each in the same period.

The Nifty50 climbed above 14,600 in the week gone by but bears took control on Friday and pushed the index towards 14400 levels, but the trend still remains to be on the upside.

Experts are of the view that that the volatility will increase as the hype and expectations from the Budget rise which could pose for a choppy market in the coming weeks too. India VIX rose from 20.65 as on 8 January to 24.01 recorded on 15 January.

On the upside, 14,650 is likely to act as an immediate resistance now. On the daily chart, Nifty closed below 5-day EMA for the first time in the recent past, which is the first sign of weakness.

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“The extension of profit-booking cannot be ruled out this week. The moment we see Nifty sliding below 14,380, the index may slide towards 14,250-14,100 levels. In terms of stocks, the fatigue was seen in so many counters from Wednesday itself,” Sameet Chavan, Chief Technical & Derivatives Analyst at Angel Broking told Moneycontrol.

“The banking index is at its previous record highs and the Nifty Midcap 50 index, which is at the crucial Fibonacci ratios, may see much-awaited corrective moves,” he said.

Chavan further added that since the overall trend has been strongly bullish, even if the correction comes. Traders are advised to stay light and avoid aggressive leveraged positions.

Here is a list of top 10 stocks from various experts for the next 3-4 weeks:

Expert: Navneet Daga, Senior Derivatives Analyst – Institutional Equities, YES SECURITIES

HDFC Ltd: Buy| LTP: Rs 2631| Target: Rs 3000| Stop Loss: Rs 2400| Upside 14%

The Nifty leadership was driven by HDFC Ltd in the past 2 months. The stock broke above its multi-year highs (2500+), and we expect the stock to trade with a positive bias going in the budget event with a focus on housing, and infrastructure.

We expect the stock to find support near the 2550-2600 zone with a rally likely to extend towards Rs 3,000 mark with support seen at Rs 2400 mark.

REC: Buy| LTP: Rs 145| Target: Rs 169| Stop Loss: Rs 135| Upside 16%

On the weekly chart, REC had formed a big Tall Red bar last year in the last week of Feb 2020, before embarking upon a big move on the downside.

Thereafter, a phase of consolidation between April & June was seen. REC picked up momentum eventually in the third week of October 2020.

In the last week, it attempted a break above Feb’s 2020 big tall red bar. Sustenance above Rs145 would result in the resumption of an uptrend towards a move of Rs169 with a Stop Loss of Rs135.

Hero MotoCorp: Sell| LTP: Rs 3205| Target: Rs 2950| Stop Loss: Rs 3320| Downside 8%

Forming a series of ascending peaks the stock gradually moving higher. However, the recent rally failed to surpass Oct’20 peak which eventually triggered some profit-taking.

The stock has multiple hurdles near the 3320-3400 zone, while on the flip side, it could revisit levels of 2950-2900.

Expert: Abhishek Chinchalkar, CMT Charterholder at FYERS

ITC: Buy| LTP: Rs 215| buy near Rs 215| Stop Loss: Rs 205| Target: Rs 230| Upside 7%

ITC broke above the neckline of a major Inverse Head & Shoulder pattern in November 2020 and has since been in an uptrend. Over the past four weeks, it has broadly consolidated between 200 and 218.

The stock is now edging closer towards the upper end of this consolidation zone with a nice uptick in volume. A break above this consolidation range would signal at a continuation of the rally.

UPL: Buy| LTP: Rs 522| Buy at Rs 520| Stop Loss: Rs 490| Target: Rs 570| Upside 9%

UPL broke and closed above the neckline of an Inverse Head & Shoulder pattern in the week gone by. The breakout has also been accompanied by an expansion in volume, which is a positive sign.

Looking ahead, as long as the stock holds above 493, we can expect the rally to extend further.

Bajaj FinServ: Sell| LTP: Rs 8631| Sell at Rs 8700| Stop Loss: Rs 9000| Target: Rs 8200| Downside 5%

After a strong rally in November 2020, Bajaj FinServ has shown signs of fatigue. For the past eight weeks, the stock has consolidated, with rallies above 9000 being met with profit booking.

On the daily time frame, the stock has formed a lower high. A break below 8560 would form a lower low as well, which would signal at a short-term price correction in the days ahead.

Expert: Ashis Biswas, Head of Technical Research at CapitalVia Global Research Ltd

Apollo Hospitals Enterprise Ltd: Buy| LTP: Rs 2591| Target: Rs 2780| Stop Loss: Rs 2520| Upside 7%

Apollo Hospitals is one of the outperformers in the segment, and a recent breakout above Rs 2,530 is positive. We expect the stock to maintain its uptrend in the short to medium term.

We can expect a target of Rs 2,780 from a medium-term perspective. We recommend a buy with a stop loss of Rs 2,520.

Deepak Fertilizers Ltd: Buy| LTP: Rs 162| Target: Rs 195| Stop Loss: Rs 134| Upside 20%

The stock is trading above 200-Days Exponential Moving Average, which indicates a positive outlook on the stock. Deepak Fertilizers has bounced from the support of an uptrend moving trend line.

We expect a target of Rs 195 from a medium-term perspective. We recommend a buy with a stop loss of INR 134.

Expert: Sameet Chavan, Chief Technical & Derivatives Analyst at Angel Broking

Vodafone Idea | Buy | LTP: Rs 13.60 | Target price: Rs 20 | Stop loss: Rs 10.90| Upside 40%

We mostly avoid such low ticket size counters because of their irregular behavior. But the kind of price and volume development we witnessed in this counter last week, this stock cannot be overlooked.

The stock broke out convincingly above its multi-month resistance with some authority to mark the highest close in the last 18 months.

If we look at the volume activity, it suggests tremendous buying interest in the stock.

On the monthly chart, the stock traversed 20-EMA which is supported by the RSI-smoothened oscillator which has crossed the 30 mark to come out of the bearish (oversold) territory after May 2018.

We recommend going long on a decline towards 13 for targets of Rs 18-20 in the coming weeks.

Indraprastha Gas (IGL) | Sell | LTP: Rs 548.85 | Target price: Rs 527 | Stop loss: Rs 576| Downside 4%

All these gas distribution companies have given extraordinary moves since mid-October.

IGL has been one of the marquee PSU names, managed to clock whopping gains of nearly 55 percent in such a short span of time to register a fresh record high of Rs 581 last Thursday.

Unfortunately, it failed to sustain at higher levels as profit-booking pulled prices lower last Friday to enter the sub-550 territory.

On the daily chart, we can see a ‘Shooting Star’ pattern getting confirmed whereas, on the weekly time frame, the ‘Gravestone Doji’ has been formed.

Hence, although the broader degree trend remains strongly bullish, a short-term correction cannot be ruled out. Traders can look to sell the stock on a bounce towards Rs 560-565.

Disclaimer: The views and investment tips expressed by 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.
Kshitij Anand is the Editor Markets at Moneycontrol.

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