A sustained trade above this support line i.e. 11,550 can trigger short covering which could take the index towards 11,660-11,730.
On May 6, The Nifty50 index continued to slide lower following a gap-down opening and ended sharply lower amidst a global selloff.
Further, the volatility index simultaneously rose 11 percent in trade as traders initiated fresh shorts, suggesting weakening uptrend.
However, it managed to take support at the trendline formed joining the recent low of 11,550. A sustained trade above this support line i.e. 11,550 can trigger short covering which could take the index towards 11,660-11,730.
On the flip side, a breakdown from the support of 11,550 can extend the correction towards levels of 11,500-11,425.
Here is a list of top three stocks which could give 8-14% return in the next 3-4 weeks:
Star Cement: Buy| Target: Rs 118-124| Stop Loss: Rs 102| Upside 8-14%
On the daily chart, Star cement is on the verge of a breakout from the neckline of an Ascending Triangle pattern placed at Rs 110.
A sustained trade beyond the neckline will trigger a breakout resuming the uptrend in the stock. Moreover, it has taken support at the 50 percent Fibonacci retracement level i.e. 97 and turned higher affirming bullishness intact in the stock.
Moreover, RSI has formed a positive reversal indicating higher levels in the coming trading sessions. The stock can be bought in the range of Rs 108-110 for a target of Rs 118-124, keeping a stop loss below Rs 102.
PNC Infratech: Buy| Target: Rs 168-175| Stop Loss: Rs 145| Upside 9-14%
On the daily chart, PNC Infratech has turned upwards after taking support at the lower end of the channel pattern suggesting bullishness building up in the stock.
Further, on the weekly time frame charts, it is currently consolidating at the neckline of the channel following a bullish breakout.
A sustained trade above Rs 158 will resume the upward journey taking the stock higher towards levels of Rs 168-175.
The RSI has also turned higher after constantly taking support at the 45-level suggesting that bulls are having an upper hand in the stock currently.
The stock can be bought in the range of 153-155 for targets of Rs 168-175, keeping a stop loss below Rs 145.
Blue Star: Buy| Target: Rs 765-790| Stop Loss: Rs 680| Upside 8-11%
On the weekly chart, Blue Star is approaching neckline of an Ascending Triangle pattern placed at Rs 722, a successful breakout from the neckline will take the stock higher to levels of Rs 765-790.
On the daily time frame, it has turned upwards after taking support at the 50 percent Fibonacci retracement level in the recent corrections confirming the bullishness.
Further, RSI has turned north after taking support at the 40-level suggesting that there are more legs to this rally following the bullish breakout.
The stock can be bought in the range of Rs 708-712 for targets of Rs 765-790, keeping a stop loss below Rs 680.
(The author is Senior Manager, YES 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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