Vikas Jain
The Nifty50 index which had retraced 50 percent of the up move of 10,650-11,650 levels near to 11,100 levels recorded a bounce back on October 9. The index closed with gains of 186 points at 11,313.
We believe that Nifty should trade in the range of 11,000-11,400 levels over the next few weeks while Bank Nifty can gain positive momentum once it crosses the 200-day average placed at 28,870 levels. Nifty Bank closed with gains of 1,018 points at 28,785.
With the second-quarter results started to pour in from this week, it should provide individual stock specific movement from the current levels.
The Nifty midcap index has made a triple bottom on the monthly charts in the range of 15,000-15,300 levels which indicates that the broader markets are in a sweet spot and any incremental positive news flow from the domestic or global markets would lead to positive momentum.
Here is a list of top three stocks which could give 8-12 percent return in the next three-four weeks:
Axis Bank: Buy | LTP: Rs 686 | Target: Rs 750 | Stop Loss: Rs 620 | Upside 9 percent
The stock has multiple supports in the range of Rs 640-650 levels and has witnessed a positive bounce back from the lower range in the past two months.
The key technical indicators are positively poised above their neutral line, signaling strength in the stock.
The stock witnessed higher bottoms formation on the weekly charts and strong support is placed near its 200-week average which will save the stock falling from current levels.
Long position can be initiated for the target of Rs 750 with a stop loss below Rs 620.
Bharti Airtel: Buy | LTP: Rs 359 | Target: Rs 390 | Stop Loss: Rs 328 | Upside 8 percent
The stock is holding above its 200-week average and is witnessing positive spikes with strong volumes on the daily charts.
It witnessed a reversal in the key technical indicators such as RSI and is now trading above the average lines which confirms that the medium term is positive.
Investors can initiate long positions for the target of Rs 390, and a stop loss below Rs 328.
LIC Housing Finance: Buy | LTP: Rs 378 | Target: Rs 425 | Stop Loss: Rs 350 | Upside 12 percent
The stock has completed its 61.8 percent correction of prior up-move (154-794) signaling near-term turnaround.
Time-wise correction confirms a 13-week down cycle, and the reversal is on the cards. The stock is trading in an oversold zone which confirms our view.
Traders can initiate a long position for a target of Rs 372, and a stop loss can be placed below Rs 350 on closing basis.
(The author is Senior Research Analyst, Reliance Securities)
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