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Last Updated : Jul 22, 2019 08:24 AM IST | Source: Moneycontrol.com

Podcast | Stock picks of the day: Grasim, Adani Ports & Bajaj Finance top shorting ideas

If Nifty trades below 11,485 levels then we may see some profit booking initiating in the market, which may correct up to 11,330-11,245-11,090 levels

Moneycontrol Contributor @moneycontrolcom
 
 
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The Nifty started the week on a flat note and extended positive momentum in the initial half, but selling pressure at higher levels dragged the index towards the lower to end the week on a negative note. The Nifty closed at 11,419 with a loss of 133 points for the week ended July 19.

Close

On the weekly chart, the index has formed a bearish candle forming lower High-Low compared to the previous week indicating negative bias. On the daily chart, Nifty has decisively broken down its past eight sessions Up-sloping Trendline support on a closing basis which signals further weakness.

The chart pattern suggests that if Nifty crosses and sustains above 11,500 levels then it could upward momentum which would take the index towards 11,580-11,700.

However, if the index breaks below 11,400 levels it would witness selling which would take the index towards 11,320-11,260. The Nifty is trading below 20, 50 and 100-day SMA's which are important short term moving average, indicating negative bias in the short term.

The Nifty continues to remain in a downtrend in the short term, so buying near to major supports on dips continues to be our preferred strategy. For the week, we expect Nifty to trade in the range of 11,550-11,270 with a negative bias.

The trend deciding level is 11,485. If NIFTY trades above this level then we may witness a further rally up to 11,575-11,725-11,815 levels.

However, if Nifty trades below 11,485 levels then we may see some profit booking initiating in the market, which may correct up to 11,330-11,245-11,090 levels.

Here is a list of top three stocks which could give 4-7 percent return in the next three-four weeks:

Grasim Industries (Aug Fut): Sell| selling range: Rs 888-900| LTP: Rs 881.30| Target: Rs 855-840| Stop Loss: Rs 911| Downside 4-6 percent

On the daily chart stock, the price has decisively broken down from its Horizontal Channel levels of 950-885 on a closing basis and is also sustaining below the same.

This breakdown is accompanied with an increase in volumes which supports bearish sentiments ahead. The daily strength indicator RSI and the momentum indicator Stochastic both are in negative territory which supports downside momentum to continue in the near term.

The stock price has broken its 20 and 50-day SMA which supports bearish sentiments ahead.

Adani Ports (Aug Fut): Sell| Selling Range: Rs 410-418| LTP: Rs 408| Target: Rs 395-387| Stop Loss: Rs 423| Downside 5-7 percent

On the daily chart, the stock price has again failed to cross its resistance zone and witnessed selling pressure at higher levels.

This breakdown is accompanied with an increase in volumes which supports bearish sentiments ahead.

The daily strength indicator RSI and the momentum indicator Stochastic both have turned negative which supports downside momentum to continue in the near term.

The stock price has broken its 20 and 50 day SMA which supports bearish sentiments ahead.

Bajaj Finance (Aug Fut): Sell| Selling Range: Rs 3,380-3,420|LTP: Rs 3,346.60| Target: Rs 3,260-3,180| Stop Loss: Rs 3,500| Downside 4-6 percent

On the daily chart, the stock price has decisively broken down from its Upsloping Trendline levels of Rs 3,475-3,480 levels on a closing basis and sustaining below the same.

This breakdown is accompanied with an increase in volumes which supports bearish sentiments ahead. The weekly strength indicator RSI and the momentum indicator Stochastic both are in negative territory which supports downside momentum to continue in the near-term.

The stock price is sustaining well below its 20 and 50-day SMA which supports bearish sentiments ahead.

(The author is Head Technical & Derivatives Research, Axis Securities)

Disclaimer: 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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First Published on Jul 22, 2019 08:24 am
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