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Podcast | Stock picks of the day: Nifty may see follow-through buying in coming sessions

We believe that the Nifty can witness a follow-through buying in the coming sessions towards 11,780-11,800 mark while on the downside 11,600-11,550 level will act as strong support for the index.

July 17, 2019 / 08:11 AM IST
 
 
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Shitij Gandhi

Indian markets registered sharp gains in the July 16 session as Nifty50 once again reclaimed 11,650 mark on local bourses on the back of a recovery in Pharma, Reality and Auto stocks.

The derivative data has also shown some improvement at the support levels after last week steep fall. Put writers were seen active in 11,600 & 11,500 strikes in the weekly contract along with marginal call unwinding.

From technical front as well, Nifty and Bank Nifty both the indices manage to hold above its 100-days exponential moving average (EMA) on the daily charts which is once again a positive signal for the markets moving forward.

Close

We believe that the Nifty can witness a follow-through buying in the coming sessions towards 11,780-11,800 mark while on the downside 11,600-11,550 level will act as strong support for the index.

Here is a list of top three stocks which could give 7-13 percent return in the next three-four weeks:

Gujarat State Petronet: Buy| Target: Rs 236| Stop Loss: Rs 193| Upside 13 percent

The stock has been consistently trading above its short as well as long-term moving averages on the daily as well as weekly interval chart, and now it has given a breakout above the key resistance of Rs 200-level after a prolonged consolidation of three months.

Additionally, the stock has also given a break above the ascending triangle pattern on the weekly charts along with higher volumes which suggest that there more upside in the offing.

Traders can accumulate the stock in the range of Rs 208-212 for the upside target of Rs 236 levels and a stop loss below Rs 193.

ACC: Buy| Target: Rs 1,720| Stop Loss: Rs 1,530|Upside 7 percent

The stock made a double bottom pattern around Rs 1,485 levels, and then bounced back sharply once again above its long-term moving averages to regain the momentum above Rs 1,600 levels.

At the current juncture, the stock is witnessing a long build-up into the prices along with higher volumes which suggest follow up buying into the prices from here on.

Additionally, the stock is forming up a W-pattern on the daily charts which can move the prices towards Rs 1,700 zone.

Traders can accumulate the stock in the range of Rs 1,605-1,612 for the upside target of Rs 1,720 levels and a stop loss below Rs 1,530.

Manappuram Finance: Buy| Target: Rs 148| Stop Loss: Rs 127 | Upside 9 percent

After testing Rs 144 levels in the recent past, the stock witnessed selling pressure at higher levels. Once again the prices fell toward its 100-days exponential moving average (EMA) on the daily charts with a series of decline over a few weeks.

At the current juncture, the stock has given a break out above its falling trend line of a downward sloping channel along with positive divergences on secondary oscillators.

Traders can accumulate the stock in the range of Rs 135-136 levels for the upside target of Rs 148 levels, and a stop loss below Rs 127.

(The author is a Senior Research Analyst, SMC Global Securities Ltd.)

Disclaimer: The views and investment tips expressed by investment experts 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.
Moneycontrol Contributor
first published: Jul 17, 2019 08:11 am

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