Shitij Gandhi
Once again after a gap-up opening, the Indian market could not hold on to gains and fell sharply into the negative territory on the back of weakness in some of the heavyweight names like TCS, Infosys and Bajaj twins.
On the derivative front, call writers once again added hefty open interest at 9,100 and 9,200 strike which limited the sharp upside in the index.
On the technical front, 8,800-9,300 range would remain crucial in the coming sessions and we may witness a tug of war among bulls and bears to continue.
We expect the market to feel pressure at higher levels. It is likely to remain volatile with some stock-specific action.
On the downside, a slide below 8,800 in Nifty could add further sell-off which could take prices towards 8,600. While on the higher side, 9,300 would be a crucial resistance level above which, call writers can be seen short-covering.
Here are two stock ideas for the next 3-4 weeks.
ACC | Buy | LTP: Rs 1,276 | Target price: Rs 1,425 | Stop loss: Rs 1,150 | Upside: 12%
After a V-shape recovery from Rs 950, the stock once again managed to surpass its 100-days exponential moving average on the daily charts on Tuesday.
The stock has seen consolidating in the range of Rs 1,100-1,250 from the last more than four weeks.
However, this week the stock has witnessed a fresh breakout above the defined range after a prolonged consolidation.
The surging volumes along with rising prices can add further follow up buying in the stock. So, traders can accumulate the stock in the range of Rs 1,250-1,260 for the upside target of Rs 1,425 with stop loss below Rs 1,150.
Shree Cement | Buy | LTP: Rs 20,540 | Target price: Rs 23600 | Stop loss: Rs 18500 | Upside: 15%
After five weeks of prolonged consolidation in a broader range of Rs 18,000-20,000, the stock has given a fresh breakout above the defined range and also manage to surpass its 200-days exponential moving average on the daily charts.
On the technical front, the breakout can be seen above the rectangle pattern, which is generally traded as a continuation pattern.
Traders can accumulate the stock on dips in the range of Rs 20,500-20,650 for the upside target of Rs 23,600 with a stop loss below Rs 18,500.
(The author is Senior Technical Analyst at SMC Global Securities)
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