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Hot Stocks: RIL, HDFC AMC and Aarti can give double-digit returns in short term

On the technical front, 16,800 could act as strong resistance for the Nifty while bias is likely to remain in favour of bulls in the upcoming sessions as well, said Shitij Gandhi of SMC Global

August 18, 2021 / 07:32 AM IST
 
 
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Both Nifty and Sensex touched record highs in Tuesday’s (August 17) session as Nifty closed above the 16,600-mark on the back of robust buying momentum seen in FMCG and IT counters.

On the flip side, PSU banks along with metal and midcaps spaces witnessed selling. On the derivative front, once again call writers were seen shifting towards higher bands while put writers added hefty open interest at 16,500 strikes.

On the technical front, the 16,800 levels would act as strong resistance for the Nifty while bias is likely to remain in favour of bulls in the upcoming sessions as well.

However, the banking index is facing a strong hurdle in the range of 36,000-36,400 zone above which we expect the index could continue its journey towards 37,000-levels in the coming weeks.

Here is a list of top trading ideas for the next 3-4 weeks:

Close

Reliance Industries: Buy| LTP: Rs 2,163| Target: Rs 2,373| Stop Loss: Rs 2,020| Upside 10%

In last two months, the stock has been fluctuating in a broader range of Rs 2,050-2,150 with prices holding well above its 200-days exponential moving average on a daily interval.

The stock has managed to surpass above Rs 2,150 levels this week after a prolonged consolidation. Additionally, the stock has also given a breakout above the Cup and handle pattern visible on broader charts.

Traders can accumulate the stock in the range of Rs 2,155-2,165 levels for an upside target of Rs 2,373 levels with a stop loss below Rs 2,020.

(Disclaimer: MoneyControl is a part of the Network18 group. Network18 is controlled by Independent Media Trust, of which Reliance Industries is the sole beneficiary.)

HDFC Asset Management Company: Buy| LTP: Rs 2976| Target: Rs 3275| Stop Loss: Rs 2800| Upside 10%

After testing Rs 3,250-levels in the recent past, the stock witnessed a sharp fall. It has been fluctuating in a broader range of Rs 2,850-3,050 since last month.

However, the stock price is holding well above its 200-days exponential moving average on daily charts. If we look at short-term charts, the stock has given a breakout above the inverted head and shoulder pattern.

The breakout above the neckline of the pattern formation can be observed with marginally higher volumes which points towards long build-up into the prices.

Traders can accumulate the stock in the range of Rs 2,970-2,980 levels for an upside target of Rs 3,275 levels, and a stop loss can be placed below Rs 2,800.

Aarti Industries: Buy| LTP: Rs 952| Target: Rs 1060| Stop Loss: Rs 880| Upside 11%

In the recent past, the stock tested its 52 week high of 982 and retraced back towards 900 levels on the back of profit booking at a higher level.

From a technical front, the stock has formed a downward sloping channel during the retracement period as prices can be seen fluctuating with the formation of lower high and lower bottom patterns on short-term charts.

This week stock has managed to take support and bounce back once again above the key resistance level of 950 with a breakout above the falling trend line of the channel.

Additionally, the breakout can be observed above the bullish flag pattern as well. Traders can accumulate the stock in the range of 945-955 levels for the upside target of 1060 levels, and a stop loss can be placed below 880.

Disclaimer: The views and investment tips expressed by 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.
Shitij Gandhi is a senior technical analyst at SMC Global Securities

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