Indian market started the week on a positive note with Nifty closing at a fresh record high on November 17, supported by auto, metal and financial stocks.
Upbeat global markets along with reports about the COVID-19 vaccine lifted the sentiment for domestic markets.
On the derivatives front, the rally was supported by short-covering, done by call writers at 12,700 and 12,800 strikes.
Furthermore, put writers added hefty open interest at 12,700 strikes and were seen shifting at higher bands.
On the technical front, now 13,000 should act as strong resistance for Nifty while 29,500 would be an immediate hurdle for Bank Nifty.
Strong support for Nifty lies at 12,600 levels.
We expect the overall trend to remain bullish in the upcoming sessions as well. We advise traders to use any dips to create fresh longs.
Here are three buy calls for the next 2-3 weeks:
ICICI Lombard General Insurance Company | LTP: Rs 1,317.55 | Target price: Rs 1,480 | Stop loss: Rs 1,230 | Upside: 12%
For the last three months, the stock has been consistently moving lower in a downward sloping channel with the formation of the lower high and lower bottom pattern.
However, this week, the stock has once again moved back above its key resistance levels of Rs 1,320 with a breakout above the falling trendline of the sloping channel.
The breakout can be seen with rising volumes and positive divergences on secondary oscillators.
The stock is holding well above its long-term moving averages on daily and weekly intervals.
EID Parry India | LTP: Rs 301 | Target price: Rs 337 | Stop loss: Rs 273 | Upside: 12%
For the last nearly seven weeks, the stock has been consolidating in a broader range of Rs 265-295 along with consistent buying around support levels.
On the daily and weekly charts, the stock is holding well above its short and long-term moving averages.
At the current juncture, the stock has formed an inverted head and shoulder pattern on the daily charts and managed to give a breakout above the neckline of the pattern formation.
ICICI Prudential Life Insurance Company | LTP: Rs 449.70 | Target price: Rs 494 | Stop loss: Rs 415 | Upside: 10%
After testing Rs 487 levels in August, the stock was seen continuously trading lower in a downward sloping channel with the formation of the lower high and lower bottom pattern.
However, it managed to take support at its 200-day exponential moving average on the weekly charts and bounced back after forming a double bottom pattern at Rs 400 levels on the daily charts.
This week, the stock has once again moved back above its key resistance level of Rs 440 with the breakout above the falling trendline of the sloping channel.
The positive divergence on secondary oscillators with a breakout suggests further upside in the prices.
(The author is Senior Technical Analyst at SMC Global 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.