Moneycontrol

Budget 2021

Associate Partners:

  • SMC
  • Samsung
  • Volvo

Moneycontrol

Budget 2021

Associate Partners:

  • SMCSamsungVolvo
Webinar :Join an expert panel for a webinar on Smart investments for a secure retirement January 28, 2021. Register now!

Hot Stocks | 'Can buy Tata Motors, JSW Steel, Hindalco for short term'

As of now, Nifty has a potential to retest 11,800–11,950 in the coming week. But traders are advised not to get carried away and avoid any aggressive bets.

February 28, 2020 / 07:32 AM IST
 
 
live
  • bselive
  • nselive
Volume
Todays L/H
More

Mehul Kothari

So far, this has been a disastrous week for the domestic market. The benchmarks have been falling for the last five trading sessions.

Nifty started the week on a pessimistic note, following negative global cues. Nifty this week has been trading with a change of 3.70 percent whereas the Nifty Bank index has performed relatively better as it has lost only 2.44 percent in the week.

We have been constantly reiterating our view that the recent pullbacks were just an opportunity to go short or exit longs in the markets.

Close

In line with that view, Nifty not only corrected sharply but breached the previous swing low of 11,615.

Now, at this juncture, the index has formed a bullish hammer pattern on the daily chart.

Further, the put-call ratio has reached near 1, which indicates the possibility of a bounce.

Earlier, when Nifty rallied from 11,615 to 11,200 the put-call ratio was 0.96. Also, the numbers of oversold stocks in the Nifty50 basket were significant.

We are of the opinion that there is a possibility of a relief rally in the market.

However, we continue to remain bearish for the medium-term with much lower targets for Nifty.

As of now, Nifty has a potential to retest 11,800–11,950 in the coming week. But traders are advised not to get carried away and avoid any aggressive bets.

Here are three buy calls for the next 3-4 weeks:

Tata Motors | Buy | CMP: Rs 145.30 | Target: Rs 153 | Stop loss: Rs 138 | Upside: 5.3%

Since January 2020, we have witnessed a relentless fall of around 30 percent in Tata Motors from the high of Rs 202 to the low of Rs 141.

Due to the one-sided move, the stock has entered the oversold zone on the daily chart. At this juncture, the stock is hovering near the potential reversal zone of the bullish AB=CD pattern.

The daily RSI oscillator has entered a zone from where it generally bounces, and that indicates some pullback in the stock.

Traders are advised to buy the stock near Rs 143 for the target of Rs 153 with a stop loss of Rs138.

JSW Steel | Buy | CMP: Rs 252.90 | Target: Rs 266 | Stop loss: Rs 242 | Upside: 5.2%

After a correction from the high of Rs 297, JSW Steel is trading near Rs 250 mark, which is the placement of the 200-day simple moving average.

Further, the previous swing low of Rs 242 can be very strong support for the stock since that is exactly at the placement of the 200-week simple moving average.

In addition, there is a trend line support near Rs 245 which indicates the possibility of a bounce.

Traders are advised to buy the stock near Rs 250 for the target of Rs 266 with a stop loss of Rs 242.

Hindalco Industries | Buy | CMP: Rs 168.40 | Target: Rs 180 | Stop loss: Rs 158 | Upside: 6.9%

Similar to Tata Motors, we have witnessed a relentless fall of around 20 percent in Hindalco from the high of Rs 215 to the low of Rs 166 since January 2020.

Due to the one-sided move, the stock has entered the oversold zone on the daily chart. At this juncture, the stock is hovering near the potential reversal zone of the bullish AB=CD pattern.

The daily RSI oscillator has entered a zone from where it generally bounces, and that indicates some pullback in the stock.

Traders are advised to buy the stock near Rs 165 for the target of Rs 180 with a stop loss of Rs 158.

(The author is Senior Technical Analyst, IndiaNivesh Securities)

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.
Moneycontrol Contributor
first published: Feb 28, 2020 07:32 am

stay updated

Get Daily News on your Browser
Sections