The current trading range is 10,950 on the higher side and 10,550 on the lower side. A decisive move above 10,950 would be a bullish sign and will take the index higher towards 11,350-11,600 zone, Manav Chopra, Head Research- Equity, Indiabulls Ventures, said in an interview with Moneycontrol’s Kshitij Anand.
Edited excerpts:
Q. Higher levels of 10,850-10,900 are acting as a crucial resistance level for the index. Do you this as nervousness ahead of the interim budget?
A. The Nifty50 is currently consolidating in a narrow range and is likely to witness a range breakout soon. Such formation is usually witnessed before any key events.
The current trading range is 10,950 on the higher side and 10,550 on the lower side. A decisive move above 10,950 would be a bullish sign and will take the index higher towards 11,350-11,600 zone.
Q. What are charts of Bank Nifty suggesting?
A. Bank Nifty witnessed some profit booking as it declined from its recent high. It is likely to see some consolidation in the near term.
Price patterns indicate strong support clusters around 27,200-27,000 on the downside that are likely to provide a cushion in case of a decline.
The momentum has turned positive and one should maintain a buy on dips approach. The rally can extend towards the 27,800-28200 in the near term. The support of 26,900 would act as a make or break level for the bulls.
Q. Please list three trading strategies for the coming week with an investment horizon of 1 month.
A. Here is a list of top three stocks which could return 10-13 percent in the next 1 month:
ITC: Buy| LTP: Rs 295| Target: Rs 320-335| Stop loss: Rs 272| Return: 13 percent
The recent decline tested the rising trendline drawn from the March 2018 low and the prices formed a Bullish Hammer candlestick that further validates the bullish structure.
The RSI has confirmed a breakout and positive reversal that indicates a new high in making. The stock is likely to exceed its July 2018 peak.
Amara Raja Batteries Ltd: Buy| LTP: Rs 756| Target: Rs 850-875| Stop loss: Rs 700| Return: 15 percent
The counter has formed a bullish candlestick pattern at the support zone and the prices have now exceeded its previous week’s high that indicates a short-term trend reversal is on the cards.
The prices have been oscillating in the range of Rs 700-880 and are likely to see a bounce from the current levels.
Muthoot Finance: Buy| LTP: Rs 536| Target: Rs 570-590| Stop loss: Rs 510| Return: 10 percent
The prices recently observed a higher high formation which confirms the continuation of the uptrend. The RSI is in a bullish momentum which indicates more upside.
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