Shitij Gandhi
This week, Indian markets logged sharp gains from its recent lows as Nifty once again reclaimed 11,100 levels on local bourses on the back of some positive announcements made by the finance minister last week, along with the RBI’s decision to transfer 1.76 lakh crore from its reserves to the government.
From the technical front as well, the Nifty has given almost a V-shaped recovery after testing its long-term moving averages on the weekly interval as short-sellers were seen covering their positions.
At the current juncture, Put writers are actively adding open interest in 11,000 Put strike which should now act as strong support for the Nifty from an expiry point of view.
However, on the higher side, 11,150 is the immediate hurdle for the index. If we close above this levels, we could further witness short covering which could take the index higher towards 11,200-11,250 levels.
Here is a list of top three stock which could give 7-10 percent return in the next three-four weeks:
Dabur India : Buy| Target: Rs 466| Stop Loss: Rs 415| Upside 7 percent
The stock has been trading high ever since prices managed to reclaim its long-term moving averages on the daily charts. This week, we have observed a fresh breakout into the prices after a consolidation period of nearly five weeks.
The stock has also formed an inverted head and shoulder pattern on the weekly interval which is again a bullish signal for the prices moving forward.
Traders can accumulate the stock in the range of Rs 435-440 for an upside target of Rs 466 levels, and place a stop loss below Rs 415.
Indraprastha Gas : Buy| Target: Rs 359| Stop Loss: Rs 305| Upside 10 percent
After forming a double bottom pattern around Rs 300 levels on the daily interval, the stock took a V-shaped recovery and managed to surpass above Rs 325 levels in a short span of time.
Moreover, prices are also trading well above their short and long-term moving averages with a formation of a higher high and higher bottom pattern on the weekly charts which is a positive sign.
We witnessed a fresh breakout above the key resistance levels of Rs 330 this week which can trigger follow up buying in the stock. Traders can accumulate the stock in the range of Rs 325-330 for the upside target of Rs 359 levels, and a stop loss below Rs 305.
Voltas : Buy| Target: Rs 671| Stop Loss: Rs 584| Upside 9 percent
In the recent past, the stock has given a sharp upside from Rs 560 levels and tested Rs 620 levels in a short span of time. However, since then, we have seen the stock consolidating in a range of Rs 585-620 which has formed a rectangle pattern on the daily interval.
We have observed a fresh breakout above the rectangle pattern alongside marginally higher volumes this week. The pattern is generally traded as a continuation pattern, therefore we can witness follow up buying into the stock moving forward.
Traders can accumulate the stock in the range of Rs 615-620 levels for the upside target of 671 levels, and a stop loss below Rs 584.
(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.
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