Rupak DeBonanza Portfolio
The Nifty started the Wednesday session gap up, but it remained choppy through the day. The index formed a bullish ‘Hammer’ kind of pattern on daily charts on Wednesday which suggests the market is finding short-term support at current levels.
Pharma stocks were the worst performers whereas OMC stocks outperformed the benchmark index for the day. The volatility index (VIX) has witnessed a marginal fall of 0.84 percent during the day.
On the options front, 10,300 and 10,400 Calls added most open interest whereas 10,000 and 10,200 puts ended as most active.
Going forward, the Nifty is likely to consolidate within the range of 10,000 and 10,450. A decisive breakout on either side will confirm the future trend.
Breakdown of lower band of 10,100 may trigger a selling pressure which may take the index towards 9,800. On the other hand, 10500 may act as immediate resistance. A sustained trade above 10,500 may induce further rally towards 10,700.
Here is a list of top three stocks which could give 7-9% return in the November series:
RBL Bank: Buy| CMP: Rs.493.25 | Target Rs 537| Stop Loss Rs 468| Return 9%
After prolong corrective phase, the stock has formed a bottom which indicates a sign of reversal on the daily chart. The counter has taken support at its 200-EMA and it is trading near its trendline support on the weekly time frame charts.
In the past, whenever the stock has retraced near its 200-EMA it has respected and moved higher from that level. In terms of candlestick patterns, the stock has formed a bullish Morning Star pattern near its bottom reviling hopes for bulls to gear ahead.
A bullish crossover in the daily RSI may induce a positive shift in bullish momentum in the stock price. Traders can accumulate the stock in the range of 488–496 for the target of 537 and a stop loss below 468.
SBI: Sell| CMP: Rs 255.70 | Target Rs 236.50 | Stop Loss Rs.266| Return 7.5%
On the daily chart, the price has breached its trendline support and witnessed a symmetrical triangle breakdown at 255.65. Moreover, the price is trading below its 50 & 21-DEMA which will act as a near-term resistance.
A bearish crossover with bearish range shift in the daily RSI (14) is being witnessed which may induce a negative shift in the stock price.
Traders can accumulate the stock in the range of 252-257.50 for the target of 236.50 with a stop loss above 266.
HDFC: Buy| CMP: Rs. 1741.45| Target: Rs 1890| Stop Loss Rs.1653| Return 9%
The stock after a steep correction has halted near its trendline support on the daily timeline which acted as a support in the previous two occasions.
In the candlestick pattern, the stock has formed a bullish Engulfing on the daily charts near its bottom which has revived hopes for the bulls to move ahead.
Furthermore, the counter is trading way above its 200-DEMA in the weekly sessions. The momentum oscillator RSI (14) has witnessed bullish divergence along with bullish crossover suggesting a continuation of bullish momentum.
Traders can accumulate the stock in the range of 1730-1755 for the target of 1890 and a stop loss below 1653.
Disclaimer: The author is a Technical Research Analyst at Bonanza Portfolio. 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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