Kshitij Anand Moneycontrol News
The Nifty50 scaled Mount 9,600 last week and if the momentum continues, the index is all set to head towards 9,700 and 9,800 in the next 2-4 weeks.
After a strong rally witnessed in the last 2 weeks, investors are advised to book some profits and re-enter at lower levels, because the market is most likely to consolidate in a narrow range in this week.
Despite seeing some correction in the early part of last week, bulls managed to push the index beyond crucial resistance levels. Traders should not get alarmed about small dips which could come this week but instead look at entering markets at lower levels.
“We maintained our bullish stance on the market and advised traders to stay with the larger degree uptrend. Going ahead, we can see a continuation of this move; but upside in the near term now seems limited. In last 4–5 months, we have not used a word ‘cautious’ even on a single occasion,” Sameet Chavan, Chief Analyst Technical, and Derivatives, Angel Broking Pvt Ltd.
“We would like to highlight few key observations, which are 1) the 127 percent Reciprocal retracement of the recent ‘Bullish Flag’ pattern on daily chart is at 9642, 2) The ‘Golden Ratio’ (161 percent Reciprocal retracement) of the corrective move from 8968.70 to 7893.80 is at 9624 and most importantly, 3) The ‘Multi-year Price Extension’ (127 percent of 2252.75 to 6338.50 from 4531.15) is at 9720,” he said.
Chavan further added that all these key ratios are converging in a band of 100 points i.e. 9,620 – 9,720 and hence, looking at this evidence, we would advise traders to start taking some money off the table.
Here is a list of top five stocks from various experts which could give a return of 11 percent in the short term:
Indiabulls Housing Finance: BUY| Target Rs 1150| Stop Loss Rs1028| Return 5 percent| Time 5 sessions
The stock has been forming ‘Higher Top Higher Bottom’ structure and is thus in an uptrend. In the last few trading sessions, prices have been consolidating near the ‘200 SMA’ support on the hourly chart, which also coincides with the 50 percent retracement of the previous up move.
The Relative strength index (‘RSI’) oscillator has taken support around 50 and is indicating a positive momentum. Angel Broking recommends buying this stock for the target of Rs.1150 by keeping a strict stop loss placed at Rs.1028.
NMDC: BUY| Target Rs 129| Stop loss Rs109| Time 14-21 sessions| Return 11.2 percent| 5-10 sessions
After a decent rally from Rs64.50 to Rs147.85, the stock has started moving in a corrective phase. The correction of the last three months should halt at current juncture as the stock is retesting its ‘Falling Trendline’ breakout levels on the monthly chart.
The mentioned breakout levels coincide with the 38.20 percent retracement level (116) of the mentioned up move and ’20 EMA’ on the monthly chart, which is placed around Rs113.75. Traders are advised to buy with a target of Rs.129 in coming 14 - 21 sessions. The stop loss should be fixed at Rs.109.
MindTree: BUY| Target Rs563| Stop Loss Rs508| Return 5 percent | Time 2-3 weeks
Of late, most of the ‘Midcap IT’ stocks have been on a roll and ‘Mind Tree’ is clearly one of them. The stock has managed to give a smart recovery after posting a recent low of 435.
Looking at the weekly chart, we can see a good base formation along with consistent pick up in volume activity. On Thursday, the stock confirmed a breakout from the near-term hurdle of 518.
One should look to buy for a near-term keeping a target of Rs.563 in mind for coming 2 – 3 weeks. A Stop loss can be placed at Rs.508.
Brokerage: SMC Capital
Ashok Leyland: BUY| Target Rs94| Stop Loss Rs84| Return 2 percent
The stock closed at Rs91.55 on 26th May 2017. It made a 52-week low at Rs73.50 on 22nd November 2016 and a 52-week high of 111.70 on 01st June 2016. The 200-days Exponential Moving Average (EMA) of the stock on the daily chart is currently at Rs86.89.
The stock is trading in northward direction since its inception. Moreover, after a marginal fall from higher levels, it managed to rebound sharply with volumes that indicate its potential to continue its upward momentum in the near-term.
Therefore, traders can buy the stock in the range of Rs87-89 levels for the upside target of Rs93-94 levels with a stop loss below Rs84.
Hindalco Industries: BUY| Target Rs208| Stop Loss Rs189| Time 1-2 months| Return 5 percent
The stock closed at 198.40 on 26th May 2017. It made a 52-week low at 87.55 on 25th May 2016 and a 52-week high of 203.90 on 02nd May 2017. The 200 days Exponential Moving Average (EMA) of the stock on the daily chart is currently at 170.66.
The stock is successful in maintaining its upward momentum with a sharply rally in the boarder index that indicates its strength.
SMC Capital anticipates that the stock may go further on a higher side in the coming weeks. Therefore, traders can buy the stock in the range of Rs195-197 levels for the upside target of 206-208 levels with a stop loss below Rs189.
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.
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