On the weekly timeframe, the Nifty50 has thrown up a notable price action development, as the index traded at an eight-week high. Specifically, the index has maintained the formation of higher highs and higher lows.
This upward momentum was observed after a bounce from the 50 percent Fibonacci retracement level, which was calculated based on the prior advance from 15,183.40 in June 2022 to the high of 18,887.60 in December 2022.
On the daily time frame, a classical breakout of the Inverse head and shoulder pattern can be witnessed which indicates beginning of the trend towards uptrend.
The index has a strong support at 17,500 (swing low), followed by 17,200 (key support). While on the higher side, the mark of 18,473 (swing high) followed by 18,887 (life high) are crucial levels to watch out for.
The overall trend looks positive for the Nifty50, we expect the prices to move higher till 18,473 followed by 18,887 level.
Here are three buy calls for next 2-3 weeks:
Aditya Birla Capital: Buy | LTP: Rs 173.35 | Stop-Loss: Rs 162 | Target: Rs 195 | Return: 12.5 percent
The stock has shown impressive resilience, consistently maintaining a level above Rs 133, a threshold that was breached for the first time post September 2018. This sustained performance has been observed since early December 2022, illustrating significant strength despite the overall correction in the market.
In the latest week, the stock has given a breakout of Rounding pattern, indicating a continuation of the trend to the upside.
On the daily timeframe, the stock is above its key moving averages of 50, 100, and 200-day EMA (exponential moving average), confirming the presence of an uptrend.
The RSI (relative strength index) on the weekly timeframe has sustained well above the 60 mark, reflecting the presence of positive momentum.
We expect the prices to move higher till Rs 195 level where the stop-loss must be Rs 162 strictly on the closing basis.
ABB India: Buy | LTP: Rs 3,645.35 | Stop-Loss: Rs 3,430 | Target: Rs 4,250 | Return: 16 percent
The stock price is currently trading at its life-high which tells that the stock already is in strong momentum. The stock in the latest week has given a breakout of Inverse Head & Shoulder pattern indicating continuation of the trend to the upside.
On the weekly timeframe, the stock has sustained well above the 16-week SMA (simple moving average) which as acted a strong variable support for the prices earlier in uptrend.
Additionally, the RSI on the weekly timeframe is rising and have sustained well above 50 mark reflect presence of strong momentum.
Going ahead we expect the prices to move higher till the level of Rs 4,250 where the stop-loss must Rs 3,430 on the closing basis.
Bharat Electronics: Buy | LTP: Rs 107.25 | Stop-Loss: Rs 102 | Target: Rs 120 | Return: 12 percent
The stock price is currently showing a strong upward trend, as indicated by the steep incline of its trend line. The price rebounded upwards precisely from the point where the rising slope intersected with the 23.6 percent Fibonacci retracement level, which was measured from the low point in March 2020 to the high point in September 2022.
In early December 2023, the stock gave a breakout of the Falling Wedge pattern, indicating continuation of the prior uptrend.
The stock has also surpassed the 20-week simple moving average (EMA), which has provided variable support.
The weekly relative strength index (RSI) has shown a bullish reversal, reflecting the presence of positive momentum.
We expect the prices to move higher till the level of Rs 120, where the stop-loss must be Rs 102 on the closing basis.
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