Shitij Gandhi
Nifty showed strength on July 29 closing at 11,300.55 after spending a few sessions in a narrow range of 11,100-11,225.
The gains were supported by auto and IT constituents along with cement counters. A recovery in banking stocks also made the Indian market reverse Monday's losses and end near the highest point of the day.
On the derivatives front, short-covering was seen by call writers at 11,200 strike while huge call unwinding in Bank Nifty was also observed at 22,000 call strike.
Bank Nifty has now immediate hurdle placed at 22,500, above which, it can move towards 22,750 levels as well in the coming sessions.
As far as Nifty is concerned, we believe that it will remain bullish as long as it trades above 11,200.
On the higher side, it can move towards 11,400 to 11,450 in the coming sessions.
Here are three buy calls for the next 2-3 weeks:
JK Lakshmi Cement | Buy | LTP: Rs 294 | Target price: Rs 333 | Stop loss: Rs 266 | Upside: 13%
The stock has been trading well above its 200-days exponential moving average on the daily charts.
It can be seen trading in a rising channel on the weekly interval as well, with a formation of a higher bottom pattern.
This week, the stock has given a breakout after a prolonged consolidation of more than three weeks within the range of Rs 275-290.
The rising volumes, along with consolidation breakout, suggest the next upside in the prices, going forward.
Traders can accumulate the stock in the range of Rs 289-291 for the upside target of Rs 333 with a stop loss below Rs 266.
For one month, the stock has been consolidating in the range of Rs 235 to Rs 250 with prices holding well above their short and long term moving averages on daily and weekly intervals.
At the current juncture, the secondary oscillators are showing positive divergences on daily intervals along with a rise in price with volume.
On weekly charts as well, the stock has almost given a V-shape recovery from its recent lows, holding well above its 200-days exponential moving average which suggests limited downside in prices.
Traders can accumulate the stock in the range of Rs 249-251 for the upside target of Rs 275 with a stop loss below Rs 234.
Supreme Industries | Buy | LTP: Rs 1,230 | Target price: Rs 1,335 | Stop loss: Rs 1,120 | Upside: 9%
In the recent past, the stock gave a breakout above the inverted head and shoulder pattern on the daily interval and went into consolidation since then within a range of Rs 1,100 -1,200.
On the daily chart, the stock is placed well above its 200-days exponential moving average and has given a consolidation breakout this week along with marginally higher volumes.
Traders can accumulate the stock in the range of Rs 1,200-1,220 for the upside target of Rs 1,335 with a stop loss below Rs 1,120.
(The author is Senior Technical Analyst at SMC Global Securities)
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