Going forward, 10,000-9,985 zone will act as a near-term support and any decisive closing below this level will trigger further pessimism.
The benchmark indices had convincingly broke the daily swing low of 10,094 formed on November 15, 2017, and eventually ended the Thursday’s session well below this level.
As a result, the daily chart depicts the formation of Lower Highs & Lower Lows formation. The daily RSI (14) momentum indicator broke its support zone of 40 levels which backs the above hypothesis.
On the weekly chart, we are seeing a formation of Bearish Divergence which triggered sharp sell-off in the past week. Whereas, on the monthly chart, the index broke the November month candle low of 10,094.
At this juncture, Nifty formed a ‘Downward sloping channel’ formation on the daily chart and on Thursday indices rebound from the lower band of the said channel.
Going forward, 10,000-9,985 zone will act as a near-term support and any decisive closing below this level will trigger further pessimism. In that case, markets may see a further slide and can correct towards 9,880-9.800 levels.
On the higher side, 10,180 likely to act as an immediate resistance above which Nifty might rally towards 10,260. However, from current levels upside seems to be limited and call writing at 10,200-10,300 levels will continue to act as strong supply zone for indices.
Overall, we expect the market to trade in a broad range of 10,000-10,250 levels for few trading sessions before giving any fresh breakout on either side.
Here are the lists of stocks which could give up to 22% return in 15-21 sessions:
Just Dial: BUY around Rs510 – 505| Target Rs620| Stop loss Rs450| Time frame 15 to 21 sessions| Return 22%
Recently, the stock has seen a decent traction and rallied sharply towards Rs570. Profit booking was seen from those levels, but the stock managed to hold 50% retracement support level near 486 and is gradually inching higher.
The daily RSI (14) indicates that the stock is preparing for another strong up move in the coming week. Hence, we recommend traders to buy this stock in a range of 510 to 505 with an upside price target of 620. A stop loss should be placed below Rs450 on a closing basis.
SAIL: BUY around Rs78.50| Target Rs87| Stop loss Rs74.75| Time frame 15 to 21 trading sessions| Return 12%
The stock has seen a vertical rise in the recent move as it registered a high near Rs88. Subsequently, the stock slipped into a consolidation zone which resulted in the formation of the triangle pattern.
The daily Bollinger band got squeezed indicating volatility is likely to increase from the current level. The daily RSI (14) indicates the possibility of a breakout from the said triangle.
Hence, we advocate traders to buy this stock at Rs78.50 with an upside price target of Rs87. A stop loss should be kept at Rs74.75.
KPIT Technologies: BUY around Rs163 to 160| Target Rs190| Stop loss Rs151.50| Time frame 15 to 21 trading session| Return 13%
The stock had confirmed its breakout from triangle pattern during mid-November, 2017 and rallied towards 182.
Subsequently, some profit booking was seen last week that dragged stock tested 152 levels. However, stock precisely took support near its upper band of its triangle pattern which we termed as a pullback.
The daily RSI (14) took support near 40 and rebounded sharply. We recommend traders to buy this stock in a range of 163 to 160 with a price target of 190 and stop loss placed below 151.50.
Bharti Airtel: BUY around Rs510 – 500| Target Rs565| Stop loss Rs475| Time frame 15 to 20 trading session| Return 10%
After confirming its breakout from its multi-years consolidation, the stock eventually rallied higher and hit a fresh all-time high of around 565. Subsequently, the stock slipped into consolidation and precisely tested daily 45-EMA.
The daily Bollinger band squeezed significantly indicating volatility from current level is likely to increase. On Thursday, stock saw decent buying interest and surpassed its previous swing high hence we expect the resumption of primary trend.
Therefore, traders are advised to buy this stock in a range of Rs510 to 500 with a price target of Rs565. A stop loss should be kept at Rs475.Disclaimer: The author is Head Technical Research, Way2Wealth Brokers Pvt. Ltd. The views and investment tips expressed by the 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.