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Hot Stocks | Double-digit return from SP Apparels, KEC International, Chalet Hotels likely in short term. Here's why

Trend of KEC International turned positive as stock price has formed higher top higher bottom candlestick pattern on the daily chart. Primary trend of the stock turned positive as stock price has closed above 200 days EMA.

June 28, 2022 / 06:36 AM IST
 
 
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The Nifty continued its northward journey for the third sessions in the row on June 27 on the back of strong global cues. It gained over 133 points to close at 15,832 levels. This was the highest closing for the benchmark index since June 10.

The Nifty has shown signs of bottoming out for the short term and has formed a higher low in the past five-six sessions. Moreover, it closed above the five and 11 days exponential moving average (EMA), indicating short term trend turned positive.

During the last week, the Nifty made a higher bottom at 15,367, while the index is yet to cross its previous swing high of 15,863 on the closing basis. The 14 days relative strength index (RSI) has, however, made a positive divergence, which is a positive signal for the near term. Moreover, RSI and MFI (money flow index) oscillators have witnessed breakout from the downward sloping trendline, suggesting higher possibility of price to follow them in the days to come.

A convincing close above 15,863, would give the bulls an upper hand and possibly lead to a further rally towards the next resistances at 16,026-16,173 where we have a downward gap area and the 20 days SMA. Far resistance is seen around 16,500 levels. Longs should be protected with stop-loss of 15,400 levels.

In the Option segment we have seen aggressive Put writing at 15,400-15,500 strikes. This level also coincides with the previous swing low of 15,367. Therefore, we believe that short term trend will remain bullish till Nifty is trading above 15,367 levels.

Close

Nifty Midcap and Smallcap Indices have outperformed the benchmark indices on June 27. We expect them to outperform during coming weeks and therefore focus of the traders should be on the Midcaps to generate higher returns, we believe.

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

Chalet Hotels: Buy | LTP: Rs 308 | Stop-Loss: Rs 280 | Target: Rs 335-350 | Return: 9-14 percent

The stock price has broken out on the daily chart with higher volumes where it closes at highest level since June 2, 2022. The primary trend of the stock is positive as it is trading above its all-important medium-term and long-term moving averages.

During the recent correction, stock price has taken support at the 100 days EMA. Momentum Oscillators - RSI and MFI is placed above 50 and sloping upwards, indicating strength in the current uptrend of the stock.

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SP Apparels: Buy | LTP: Rs 386.7 | Stop-Loss: Rs 355 | Target: Rs 420-440 | Return: 9-14 percent

The stock price has broken out from the downward sloping trendline on the daily chart, adjoining the highs of February 3, and June 8, 2022.

Short term trend of the stock is positive as it is trading above its 5 and 20 days EMA. Momentum Oscillator like RSI (14) is placed above 50 and sloping upwards, indicating strength in the current uptrend of the stock.

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KEC International: Buy | LTP: Rs 421 | Stop-Loss: Rs 395 | Target: Rs 450-475 | Return: 7-13 percent

Trend of the stock turned positive as stock price has formed higher top higher bottom candlestick pattern on the daily chart. Primary trend of the stock turned positive as stock price has closed above 200 days EMA.

Momentum Oscillator like RSI and MFI are placed above 60 and sloping upwards, indicating strength in the current uptrend of the stock. Plus DI (directional indicator) is trading above Minus DI while ADX line (average directional index) is placed above 25, indicating momentum in the current uptrend.

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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.
Nandish Shah
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