Indian market witnessed follow-up buying in Tuesday's session and Nifty managed to surpass the key resistance level of 15,100. The rally was supported by banking, auto and metal counters.
On the derivatives front, Call writers were seen covering their short positions at 15,000 and 15,100 strikes while Put writers are shifting at higher bands which point towards strength in current trend. On the technical front as well, Nifty can be seen trading in a rising channel with formation of higher bottom pattern.
On May 17, the index gave a fresh breakout above 15,100 levels after prolong consolidation. On the short-term charts, the breakout above ascending triangle pattern can also be observed which again points towards next upswing into the prices.
Going ahead, the bias is likely to remain bullish. However, on the downside, the immediate support is placed at 14,950-14,850 levels while 15,200 would be next hurdle.
Here is a list of three stocks to buy with short-term perspective:
Trent: Buy | Target: Rs 922 | Stop Loss: Rs 750 | Return: 13 percent
After testing levels of Rs 920 in March, the stock witnessed sharp fall and tested Rs 700 levels in quick time. However, prices took support at its 200-day exponential moving average on daily interval and once again bounced back sharply from thereon.
The stock formed a cup and handle pattern on daily charts and gave a breakout above the pattern formation with prices holding well above key resistance level of Rs 810. So, traders can accumulate the stock in range of Rs 815-830 levels for the upside target of Rs 922 levels with stop loss below Rs 750.
LIC Housing Finance: Buy | Target: Rs 495 | Stop Loss: Rs 410 | Return: 12 percent
In the recent past, the stock took support at its 200-day exponential moving average on daily charts which was placed around Rs 380 levels and bounced back from thereon to once again reclaim a move above Rs 420 levels. At the current juncture, the stock has formed an inverted head and shoulder pattern on daily charts.
The breakout above the neckline of the pattern formation can also be seen with rising volumes which points towards next up move into the prices. Traders can accumulate the stock in range of Rs 440-450 levels for the upside target of Rs 495 levels with stop loss below Rs 410.
Berger Paints: Buy | Target: Rs 850 | Stop Loss: Rs 720 | Return: 11 percent
This week, the stock has given a fresh breakout after a prolong consolidation of three months. The prices were seen fluctuation in broader range of Rs 700-780 since March 2021 with prices sustaining well above its 200-day exponential moving average on daily interval.
On the technical front, the stock formed a rounding bottom pattern on daily charts after formation of double bottom pattern. Follow through buying has been observed into the stock after a breakout as rising volumes with rise in price confirms for long build up into the prices. So, traders can accumulate the stock in range of Rs 765-780 levels for the upside target of Rs 850 levels with stop loss below Rs 720.
Disclaimer: The views and investment tips expressed by investment expert on Moneycontrol.com are his own and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
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