Jayant Manglik
Last week, the Nifty retested its crucial hurdle placed around 10,850 but failed to hold above that level, extending its prevailing consolidation phase. Global cues - lingering tensions over trade war like situation and a vertical surge in crude oil prices - dictated the market trend the world over.
Last Thursday, the rupee touched a new record low against the dollar, weighing on sentiment. Pressure continued on the broader front and a sharp decline was witnessed across the board. Finally, the Nifty settled at 10,714.30, down nearly a percent for the week-ended June 29.
Though the Nifty is still showing resilience despite the global turmoil, continuous underperformance has turned sentiment bearish in the broader market.
The index has crucial support at 10,550 levels and a decisive breakdown may result in a further decline. Private banks, FMCG and IT are our preferred picks on the sectoral front, while state-run banks, media, and select infra counters would continue to reel under pressure. We advise keeping stock-specific trading approach.
Here is a list of top 3 stocks that could return up to 6 percent in the short term:
Exide Industries Limited: Buy| Target: Rs 272| Stop-loss: Rs 247 | Return 6.25%
After seeing a marginal correction from its record high, Exide was seen consolidating around the support zone of short-term moving averages (20, 50 EMA) on the daily charts. It formed a fresh buying pivot.
The chart patterns are showing tremendous resilience while most stocks are reeling under pressure. The chart pattern is favorable too. Traders are advised to initiate fresh long positions in the range of Rs 254-256.
Dish TV India Limited: Sell | Target: Rs 68| Stop-loss: Rs 74| Return 4.89%
Dish TV has been under pressure for more than a year as it witnessed a gradual decline. After its multiple failed attempts to cross its resistance barrier of long-term average i.e. 200-EMA on the daily chart, it has formed a fresh shorting pivot.
Indications are in the favour of a breakdown in near future. We advocate creating fresh shorts in the given range of Rs 71.50-72.50. It closed at Rs 72.10 on July 2, 2018.
Coal India Limited: Sell |Target: Rs 250| Stop-loss: Rs 272|Return 5.30%
Coal India after the breakdown from its consolidation range, is currently hovering in a narrow range, offering shorting opportunities to traders.
The overall downtrend and chart formation are clearly indicating a fresh decline ahead. Traders shouldn’t miss this opportunity and create fresh shorts in the given the range of Rs 264-266. It closed at Rs 261.60 on July 2, 2018.
Disclaimer: The author is President, Religare Broking Ltd. The views and investment tips expressed by 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.
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