The Nifty50 finally scaled the much-awaited psychological level of 20,000 points on September 11 with most of the sectors joining the rally after the G20 Summit boosted the confidence of market participants.
The next target for the index to watch out for would be 20,500-21,000 level in the short term, considering the strong momentum sustained through the last seven sessions with participation by banks and IT stocks, while support is expected to be at the 19,900-19,800 levels, experts said.
The Nifty50 jumped 176 points to 19,996 on Monday, taking the total seven-day gains to 3.85 percent, while the broader markets remained on the buyers' radar as the Nifty Midcap 100 and Smallcap 100 indices rallied over a percent each on Monday.
"The Nifty has now reached to the uncharted territory. The band of 19,800-19,900 now becomes the strong support for the Nifty in the short term," Vinay Rajani, CMT, senior technical and derivative analyst at HDFC Securities.
As far as the upside target is concerned, he feels the index is now headed for the level of 20,924, which happens to be the 100 percent Fibonacci extension resistance of the entire swing seen from June 2022 (15,183) bottom to December 2022 (18,887) top, and from December 2022 (18,887) top to March 2023 bottom (16,828).
Breadth of the market is very strong as more than 91 percent of the stocks are trading above their 200 DMA in the NSE500 index. This reading is obviously overbought, he said.
Rahul Sharma, Director, Head- Technical & Derivative Research at JM Financial Services said the good thing was that the new leadership was coming from IT, capital goods and PSEs. BFSI, which remained pressured for some time, is also back in the positive territory.
The Nifty50, therefore, seems to be on track to hit 20,432 this month and 21,000 by Diwali.
Let's take a look at the top 10 trading ideas by experts for the next three-four weeks. Returns are based on the September 11 closing prices:
Expert: Viraj Vyas, CMT, Technical & Derivatives Analyst | Institutional Equity at Ashika Stock Broking
Axis Bank: Buy | LTP: Rs 1,000 | Stop-Loss: Rs 950 | Target: Rs 1,120 | Return: 12 percent
The stock has displayed a relative underperformance within the private banking sector and has been susceptible to time correction. However, recent price action over the past few weeks has been characterized by a pattern of higher highs and higher lows.
Notably, retracements following downward movements have been narrowing, signaling increased investor interest in the stock. This heightened interest is evident in the consistent buying of dips, reflecting a strong eagerness among investors to enter the market at lower levels.
Currently trading around the psychological mark of Rs 1,000 and approaching its all-time high, the stock's ability to sustain above Rs 990 is a key factor. If it manages to do so, it is likely to test Rs 1,120-1,150 range in the coming weeks.
Jubilant Foodworks: Buy | LTP: Rs 545.65 | Stop-Loss: Rs 518 | Target: Rs 610 | Return: 12 percent
The stock has been on a downward trajectory since October 2021, witnessing a substantial price correction from its Rs 900-levels to nearly Rs 400 by March of the current year. However, in May 2023, the stock exhibited a significant breakout by surpassing a downward-sloping trendline.
Despite this, a period of time correction persisted until around August this year. Currently, the stock is forming a Cup and Handle pattern, typically indicative of an accumulation phase. This pattern suggests that the stock may be on the verge of initiating an impulsive move, potentially targeting levels in the range of Rs 610-630 in the coming weeks.
Teamlease Services: Buy | LTP: Rs 2,690.6 | Stop-Loss: Rs 2,556 | Target: Rs 3,010 | Return: 12 percent
After undergoing a significant downtrend starting in October 2021, the stock finally found stability in November of the following year. Over the past 11 months, it has been consolidating within a trading range of Rs 2,600-2,100.
However, a recent breakout above the upper boundary of this range, accompanied by above-average trading volumes, suggests the potential for an upward movement in the stock. With this breakout, the stock appears poised to head towards Rs 2,900-3,000 price range in the near future.
Expert: Jigar S Patel, Senior Manager - Equity Research at Anand Rathi
Maruti Suzuki India: Buy | LTP: Rs 10,533.85 | Stop-Loss: Rs 9,500 | Target: Rs 12,000 | Return: 14 percent
After consolidating for over 5 years, Maruti finally managed to break out from the psychological hurdle of Rs 10,000. The breakout was accompanied by humongous volumes and hence looked genuine.
The theoretical long-term target for the breakout seems to be over Rs 14,000 from here on. Thus, traders are advised to buy the stock in the range of Rs 10,300 - 10,600 with a stop-loss of Rs 9,500 on a closing basis for an upside target of Rs 12,000.
Greenpanel Industries: Buy | LTP: Rs 390.8 | Stop-Loss: Rs 355 | Target: Rs 450 | Return: 15 percent
Greenpanel has been consolidating between Rs 310 and Rs 350 for the last 3 months. Recently, it gave breakout on a weekly scale. On the daily chart, it is trading above all major daily exponential moving averages, which looks lucrative.
Even the weekly RSI has rebounded from 50 levels, thus hinting at further bullish bias. Thus, we advise traders to go long in the stock in the range of Rs 375–385, with a stop-loss of Rs 355 and a target of Rs 450.
Sterlite Technologies: Buy | LTP: Rs 175.65 | Stop-Loss: Rs 160 | Target: Rs 200 | Return: 14 percent
Since the last 3 months, the said counter has been consolidating in the range of Rs 145-155. Recently it had given a clean breakout from the said range and is currently placed at Rs 171 levels. Having said that, it has also cleared its downward-sloping trendline quite comfortably.
The best part about this reversal is has bounced back from its monthly central pivot range which has acted as massive support. One can buy in the zone of Rs 173-176 for a target of Rs 200 and the stop-loss would be around Rs 160 on a daily closing basis
Expert: Vidnyan Sawant, AVP - technical research at GEPL Capital
CDSL: Buy | LTP: Rs 1,390.9 | Stop-Loss: Rs 1,280 | Target: Rs 1,585 | Return: 14 percent
Central Depository Services (CDSL) has recently broken through the significant resistance level of Rs 1,280, where we saw strong selling activity in October 2022. This breakout is particularly noteworthy because it aligns with the formation of a Cup & Handle pattern, suggesting the beginning of an upward trend.
Furthermore, the surge in trading volumes during the past week indicates a substantial buildup of long positions by investors.
During this period, CDSL's stock price has consistently remained above the 12-week exponential moving average (EMA), which has acted as reliable dynamic support, further reinforcing the bullish sentiment.
Additionally, the relative strength index (RSI) on a weekly scale has also broken out, reflecting the increased momentum in the stock's price.
Given these positive indicators, our expectation is that CDSL will continue its ascent, potentially reaching levels around Rs 1,585. To manage risk, we recommend setting a stop-loss at Rs 1,280 on a closing basis. This approach aims to capitalize on the current bullish momentum while safeguarding against potential downside risks.
Canara Bank: Buy | LTP: Rs 360 | Stop-Loss: Rs 320 | Target: Rs 450 | Return: 25 percent
Canara Bank stock has recently exhibited a breakout from the Ascending Triangle pattern on the weekly charts, accompanied by robust trading volumes, and it is currently trading at a multiyear high, indicating a strong bullish sentiment.
Importantly, Canara Bank has consistently respected key moving averages such as the 50, 100, and 200 simple moving averages (SMA), all of which are in a positive alignment. This suggests substantial interest in the stock and solidifies the positive outlook.
On the daily charts, the stock has also broken out from a Cup & Handle pattern with rising trading volume, a pattern that has been forming since January 2023. This reinforces the bullish stance on the stock.
Furthermore, the Relative Strength Index (RSI) is trending upward and has remained above the 60 mark on various timeframes, including daily, weekly, and monthly, underscoring the enduring upward momentum.
Looking ahead, we anticipate that stock price will continue to rise, potentially reaching levels around Rs 450. To manage risk, we recommend placing a stop-loss at Rs 320 on a closing basis.
HDFC AMC: Buy | LTP: Rs 2,663.9 | Stop-Loss: Rs 2,410 | Target: Rs 3,200 | Return: 20 percent
HDFC AMC has shown remarkable resilience after hitting 52-week lows in March 2023, marking a strong comeback. The stock has demonstrated a higher high-higher low pattern, indicating a series of upward movements with notable buying interest, especially evident in the strength of green body candles on the monthly charts.
On the weekly charts, the stock has broken out of a Bullish Flag pattern, which suggests a robust positive sentiment for the medium to long term. Additionally, the stock has formed a Change in Polarity (CIP) pattern around the 2400 level, a significant signal of a positive reversal.
Momentum indicators such as the RSI are consistently above the 60 level and trending upward, indicating strong positive momentum in the stock.
Our bullish outlook for HDFC AMC extends over the medium to long term, and we anticipate a potential price movement toward Rs 3,200 mark. To manage risk, we recommend setting a stop-loss at Rs 2,410 on a closing basis.
Expert: Vinay Rajani, CMT, senior technical & derivative analyst at HDFC Securities
Sun Pharma: Buy | LTP: Rs 1,136.9 | Stop-Loss: Rs 1,084 | Targets: Rs 1,214-1,265 | Return: 11 percent
Sun Pharmaceutical Industries has broken out from downward sloping channel on the daily chart. Stock price found support near its 50-day EMA (exponential moving average) and bounced back.
It is trading above its 20, 50 and 200 DMA, indicating bullish trend on all time frame. Indicators and Oscillators like MACD and RSI have turned bullish on the daily charts. Nifty Pharma Index has resumed its primary uptrend.
Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
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