Bulls continued to have a strong hold at Dalal Street despite corrections in the middle of the last week. As a result, the benchmark indices closed above the crucial 60,000 levels on the BSE Sensex and 18,000 levels on the Nifty50 on Friday.
Benchmark indices gained 1 percent each during the last week to close at 60,686.69 and 18,102.75 respectively, driven by infra, energy, IT, and auto stocks, though the correction in banks and pharma limited the upside.
The Nifty50 saw bullish candlestick pattern formation on the daily as well as weekly charts, but overall it has been in a broad range since hitting record highs of 18,600 levels on October 19. In the coming week, 18,000 is expected to be critical for holding the uptrend, experts feel.
"For the coming week, 18,200 – 18,350 is to be seen as a crucial range and till the time we do not surpass it convincingly, we are not completely out of the woods yet. In fact, it would be too early to comment on it; but we can clearly see a bearish formation of 'Head and Shoulder' being in process on the daily chart of Nifty," said Sameet Chavan, Chief Analyst-Technical and Derivatives at Angel One.
"The neckline support is around 17,700 – 17,600 which, if gets broken, we could see difficult days for the market in the short run. With reference to our recent cautious stance on the market, we will not be surprised to see it happening soon, if we fail to go beyond the mentioned zone of 18,200 – 18,350 in the forthcoming week," he said.
The main reason to continue with the cautious stance is the formation of 'Shooting Star' pattern on the monthly chart. "As long as we do not break the high of the candle, it can prove its significance anytime," he said. Hence, he reiterated on avoiding aggressive longs and even if one wants to follow stock specific moves, needs to be very selective.
Here are 10 trading ideas by experts for the next 3-4 weeks. Returns are based on November 12 closing prices:
Expert: Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities
Bosch: Buy | LTP: Rs 18,565.75 | Stop Loss: Rs 17,700 | Target: Rs 20,500 | Return: 10.4 percent
The last week's move has strengthened the broader trend of the stock. The broad trend of the stock is following the pattern of Inverted Head and Shoulder, which indicates that the stock is moving towards the price target of Rs 25,000.
In the next few weeks, the stock should reach at least Rs 20,500, according to the current pattern and medium-term outlook. We should be buyers at current levels and more on dips. Keep the last stop loss at Rs 17,700.
HPCL: Buy | LTP: Rs 347 | Stop Loss: Rs 335 | Target: Rs 390 | Return: 12.4 percent
On the daily and weekly charts, the stock is making a series of higher top bottom. The stock has also surpassed the multi-year resistance at Rs 335, which supports the stock's broader trend.
Based on that, the stock should achieve its target price of Rs 390. We should buy at current levels in order to put more emphasis on the decline. Long positions should be covered with a stop loss at Rs 325.
UPL: Buy | LTP: Rs 769.55 | Stop Loss: Rs 725 | Target: Rs 855 | Return: 11.1 percent
The stock has a strong bottoming formation between Rs 725 and Rs 690. Last week, the stock cleared the congestion area between the Rs 750 and Rs 725 levels, signalling another rally in the near term.
Based on that, we think the stock is fully prepared to reach its previous high of Rs 855. The strategy should be to buy at the current level and more on fall of around Rs 750. Keep a stop loss at Rs 725 for the price target of Rs 855.
Expert: Pushkaraj Kanitkar, VP - Equities at GEPL Capital
Infosys: Buy | LTP: Rs 1,780.20 | Stop Loss: Rs 1,650 | Target: Rs 2,000 | Return: 12.3 percent
The price chart has been in classical 'Rectangle' pattern since mid-August. This rectangle formation has taken place after the gradual rise from May to August 2021. The recent rise above the level of Rs 1,775 has been accompanied by above-average volumes, as also the fact that we have seen a positive movement in Call strikes on the higher side.
The level of breakout around Rs 1,775 has been retested in earlier correction twice. The stock belongs to a sector which is showing a relatively good amount of upside, both technically as well as fundamentally (Dollar Index above 95).
We feel the uptrend has legs to take it to a pattern projection of Rs 2,000, with further opening of extensions to Rs 2,135. A stop loss needs to be maintained around Rs 1,650, below which the pattern will negate.
Tech Mahindra: Buy | LTP: Rs 1,585 | Stop Loss: Rs 1,450 | Target: Rs 1,850 | Return: 16.7 percent
The price chart has been in three-month classical 'Cup & Handle' pattern. The pattern was further accompanied by continuation to a rational uptrend since July 2021. The stock belongs to a sector which shows a relatively good amount of upside, both technically as well as fundamentally (Dollar Index above 95).
We feel the uptrend has legs to take it to pattern projection of Rs 1,850, with further opening of extensions to Rs 1,886. A stop loss needs to be maintained around Rs 1,450, below which the pattern breaks the trendline and monthly supports.
Voltas: Buy | LTP: Rs 1,264.35 | Stop Loss: Rs 1,150 | Target: Rs 1,500 | Return: 18.6 percent
The price pattern shows a rational uptrend. It can be seen in the form of a strong bounce back exactly from 50 percent retracement of earlier move. The volume in recent past has shown an uptick, indicating emergence of a buying momentum.
We feel the uptrend has legs to take it to pattern projection of Rs 1,500. A stop loss needs to be maintained around Rs 1,150, below which the pattern breaks the retracement level rather convincingly.
Expert: Sameet Chavan, Chief Analyst-Technical and Derivatives at Angel One
L&T Infotech: Buy | LTP: Rs 7,243.25 | Stop Loss: Rs 6,950 | Target: Rs 7,500 | Return: 3.5 percent
This stock has been witnessing its dream run over the past few months. In July, stock prices formed a decent base around Rs 4,000 which was then followed by a strong price volume breakout. After this it never looked back as we could see it now surpassing the Rs 7,200 mark without giving any major correction all this while.
With Friday's strong upsurge, we can see resumption of its higher degree bullish cycle. Since it has already moved up a bit, we recommend buying on a minor pullback towards Rs 7,200 – Rs 7,150 for a short-term target of Rs 7,500. The stop loss can be placed at Rs 6,950.
Expert | Nandish Shah, Senior Derivative & Technical Analyst at HDFC Securities
IDFC: Buy | LTP: Rs 62.9 | Stop Loss: Rs 58 | Target: Rs 73 | Return: 16.1 percent
The stock price has broken out from the downward slopping trendline on the daily chart with higher volumes. The stock price has broken out on the weekly chart also where it closed at three-year high.
Primary trend of the stock is positive where it is trading above its all-important short term and medium-term moving averages. Plus, DI (Directional Indicator) is placed above the Minus DI while ADX (Average Directional Index) line is placed above 25 and slopping upwards, indicating momentum in the uptrend. Daily RSI has shown trend line breakout, which is bullish development for short term.
Lux Industries: Buy | LTP: Rs 4,185 | Stop Loss: Rs 3,900 | Target: Rs 4,700 | Return: 12.3 percent
Stock price has broken out from the downward slopping trendline, adjoining the highs of 27-July and 14-September, 2021. Stock price has been taking support at 100-day EMA (exponential moving average).
Plus, DI is placed above the Minus DI while ADX line is placed above 25 and slopping upwards, indicating momentum in the current uptrend. Daily RSI and MFI line has witnessed trend line breakout, which is bullish development for the short term.
UPL: Buy | LTP: Rs 769.55 | Stop Loss: Rs 725 | Target: Rs 850 | Return: 10.5 percent
Stock price has broken out on the weekly chart to close at highest level since week ending 13-August 2021. Stock price has already broken out from the downward slopping trendline, adjoining the highs of 16-July and 18-October, 2021.
Accumulation is seen during last few days where volumes are higher during the up days as compared to down days. Oscillators like RSI (relative strength index) and MFI (Money Flow Index) is placed above 60 and rising upwards indicating strength in the current uptrend.
Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
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