The Nifty is likely to consolidate in a narrow band of 10,080 to 9,850 and only an either way breakout or breakdown will dictate the near-term direction.
After two weeks of sharp correction, the Nifty index rebounded sharply from its crucial support zone of 9,680-9,700 and eventually concluding the week around 9,980 with gains of 1.95 percent over its previous week close.
Looking at the daily chart, the index has precisely tested the 61.8 percent retracement of its entire correction from the top of 10,179 to the bottom of 9,687.
However, the daily 9-45 EMA is still signaling negative crossover along with the weekly 9-EMA of RSI (14) which has now signaled a negative crossover with weekly 45-EMA of RSI (14).
Broadly speaking, the index is likely to consolidate in a narrow band of 10,080 to 9,850 and only an either way breakout or breakdown will dictate the near-term direction.
Call writing at 10000 strike option will continue to be strong supply zone where on lower end put writing t 9800-9900 will act as support zone for nifty.
Here is the list of 4 stocks which could give up to 11% return in 15-30 sessions:
Just Dial: BUY around 410 to 400| Target Rs510| Stop loss Rs457| Time Frame 25 to 30 sessions| Return 11%
Looking at the weekly chart, the stock has been under tremendous pressure and corrected significantly in the past few months.
During the recent correction, the stock managed to hold its previous bottom of Rs318 (December 2016) and posted a low of Rs327.
Looking at the recent structure, the weekly 9-EMA of RSI (14) has positively crossed the 45-EMA of RSI (14) and the entire development occurred near 40 levels indicates a possible shift in a range.
The weekly Bollinger Band indicator has squeezed significantly. On a daily chart, the RSI (14) has found support near 40 levels and rebound sharply.
We advocate traders to buy this stock around Rs395 to Rs390 with a price target of Rs500. A strict stop loss should be placed at Rs357.
HDFC: Sell around 1760| Target Rs1675| Stop loss Rs1805| Time frame 15 to 21 trading sessions| Return 4%
Looking at the daily chart, stock constantly resisted near Rs1800 and we saw decent profit booking. In that process, the stock breached the upward sloping trend line drawn from the bottom of around 1345.
The daily 9-45 exponential moving average (EMA) poised for a negative crossover. Hence, we expect this stock to correct in the near term.
Apollo Hospital: SELL around 1060 to 1070| Target Rs970| Stop loss Rs1110| Time Frame 15 to 21 trading session| Return 8%
Looking at the daily chart, the stock has been under pressure and corrected by forming a Lower Top Lower Bottom formation.
Recently, we saw a pullback in the stock however stock resist near the daily 45-EMA. On a daily chart, the RSI (14) indicates and overbought scenario.
Hence, we advocate traders to build a short position in a range of 1060 to 1070 with a price target of 970. Stop loss should be placed at 1110.
Nilkamal: BUY at Rs1570| Target Rs1750| Stop Loss Rs1510| Time Frame 15 to 20 trading session| Return 11%
Looking at the weekly chart, the stock has consolidated after a sharp fall from the top of around 2266 and formed a decent base formation near 1500.
The level of 1500 coincided with the weekly 89-EMA and the upward sloping trend line joined from the bottom of around 876. On a daily chart, the Bollinger band index has squeezed significantly and daily RSI (14) has signaled a shift in a range.
Hence, we expect this stock to rally higher in coming trading session and recommend entering in long position at current level with a price target of Rs1750. A stop loss should be placed at Rs1510 on a closing basis.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.