Stay cautious! Top 10 short-term trading ideas that could give 5-18% return

Nifty50 failed to hold on to the 11,300-levels on a closing basis for the week ended August 14, while Sensex broke below 38,000. The price action on the Street suggests that investors need to be cautious this week.

The formation of Doji candles in the week gone by signaled that momentum is slowing down and there is selling pressure at higher levels for the Nifty. Friday’s 1 percent cut wiped out most of the gains in the week gone by.

Nifty has seen selling pressure above 11,300-11,350 for the last three weeks, and on the downside, if it fails to hold on to 11,100-11,000 levels then chances of a reversal could increase.

Global cues will be important in charting the direction of the market in the coming week. Developments with regards to stimulus packages or tensions between the US and China will be tracked closely.

“In the coming week, participants will be eyeing the next hearing on the AGR dues, which is scheduled on Monday. And, since we are closely following global markets, developments on the further stimulus package in the US, US-China trade tension would also be on investors’ radar,” Ajit Mishra, VP Research, Religare Broking told Moneycontrol.

“At the same time, we will continue to see action on the broader front as several companies would be announcing their numbers next week,” he said.

In terms of technicals, traders should watch out for two levels 11,100 on the downside, and 11300-11350 on the upside. “Going ahead, a breach of 11100 would lead into an immediate correction towards 10975 – 10875,” Sameet Chavan, Chief Analyst Technical and Derivatives at Angel Broking Ltd told Moneycontrol.

Below 11,000, the crucial support is placed at 10875, and a breach of this would result in a strong corrective move in the next few days.

“On the weekly chart, if we apply ‘Fibonacci Time Series’ from March lows, the current weekly candle ends 6th ‘Time Zone’ and is entering a new one. Generally, such points are considered a potential reversal zone and hence, one needs to be a bit cautious going forward as our anticipation may probably turn into a reality below 11100,” said Chavan.

We have collated a list of 10 short-term stock ideas by various experts that could give 5-18% returns in the next 3-4 weeks:

Expert: Sameet Chavan, Chief Technical & Derivatives Analyst at Angel Broking

Berger Paints India | Buy | LTP: Rs 550.40 | Target price: Rs 590 | Stop loss: Rs 510 | Upside: 7%

This stock has been consolidating for the last one and half a month along with its peer counters.

However, last Friday, we witnessed stellar moves in this space. Berger Paints and Asian Paints both have identical chart structures; but looking at the placement of ‘RSI-Smoothened’, Berger looks a notch better.

Price-wise, we can see a decisive breakout happening from the recent congestion zone along with sizable volumes, providing credence to the move.

Throughout this week, stock consolidated and did not participate in Friday’s correction. Hence, we recommend going long on a decline towards Rs 545-535.

Interglobe Aviation (IndiGo) | Buy | LTP: Rs 1,133 | Target price: Rs 1,300 | Stop loss: Rs 980 | Upside: 15%

IndiGo has been the laggard for the last ten months but the way the stock surged in the last three days, it appears that it has come out of a slumber and is likely to give some decent moves.

On the daily chart, we can see a breakout happening from the ‘triangle’ pattern along with sizable volumes, indicating immense buying interest after a long underperformance.

The RSI-Smoothened oscillator on the daily chart has entered a bullish territory, which we believe would provide an impetus for the next move.

Hence, one can look to go long for an extended move towards Rs 1,250-1,300 over the next few weeks. Use dips towards Rs 1,080-1,050 to go long and the stop loss can be placed below Rs 980.

Expert: Gaurav Garg, Head of Research at CapitalVia Global Research Limited

Titan Company: LTP: Rs 1102| Buy above Rs 1120| Target: Rs 1199| Stop Loss: Rs 1047| Upside 8%

This stock has formed a Doji pattern on its weekly charts. It has near term support placed at Rs 1045 and is indicating a reversal from its support level on its daily charts.

Also, the stock is trading above its important moving averages and it seems bullish bias is likely to continue in the near future. We recommend initiating a long position above 1120.

Infosys: LTP: Rs 953| Buy above 987| Target: Rs 1040| Stop Loss: Rs 938| Upside 9%

This stock has formed an insider pattern on its weekly charts. It is trading above its important moving averages and it seems that the bullish bias is likely to continue in the near future. We recommend initiating a long position above 987 with a stop loss below Rs 938.

Shriram Transport: LTP: Rs 686| Buy above Rs 731| Target: Rs 805| Stop Loss: Rs 660| Upside 17%

This stock has formed a Doji pattern on its weekly charts. It has near term support placed at 635. The resistance for this stock is placed at 820. It also has a trend line breakout in its daily charts. We recommend initiating a long position above 731.

Avenue Supermarts: LTP: Rs 2178| Buy above Rs 2220| Target: Rs 2295| Stop Loss: Rs 2149| Upside 5%

This stock has closed on a positive note for the fourth consecutive session in its weekly charts. It is trading above its important moving averages and is indicating a reversal pattern in its weekly charts.

The resistance for this stock is placed at 2300. We recommend initiating a long position above 2220.

Expert: Shabbir Kayyumi, Head of Technical Research at Narnolia Financial Advisors Ltd.

Ujjivan Financial Services: LTP: Rs 237 | Buy around Rs 235 |Target: Rs 280| Stop Loss: Rs 205| Upside 18%

The stock on the hourly chart has witnessed an inverted head & shoulder breakout and looks positively poised to trade higher.

On the daily chart, scrip took support from line of parity and bounced back with marginally higher volumes, which suggest next upswing in the prices.

The key technical indicators in the near term time frame are in buy mode. The stock has the potential to continue the current up move and will test higher levels.

Hence, looking at the current structure we recommend buying in the stock around 238 with a stop loss of 205 on a closing basis for the target of 280 and 320 levels.

Punjab National Bank: LTP: Rs 32| Buy around: Rs 32|Target: Rs 38| Stop Loss: Rs 29.70| Upside 18%

The scrip spurted from a low of 26 after forming a cup and handle pattern. It showed a pullback on the upside which marked the high of 35.50 and started consolidating there.

Currently, it is waiting for another breakout on the upside so that it can accelerate buying momentum further. Line of polarity on the daily time frame of chart standing around 34 is suggesting bullish momentum in the scrip.

Indicators and oscillators are also showing a conducive scenario in the coming sessions. Based on the mentioned technical structure, one can go long in the scrip around 32 for the target of 36/38 marks, and keep a stop loss of 29.70.

Coal India Ltd: LTP: Rs 131| Buy around: Rs 131|Target: Rs 150| Stop Loss: Rs 122| Upside 14%

Bargain hunting is seen at lower levels in the scrip from where it formed a strong BASE near 124-127 zones.

Currently, it has given consolidation range breakout on the daily chart in which has been trading from the last few days and the momentum oscillator RSI also turned above 50 mark which suggests a reversal is round the corner.

Other indicators and oscillators also lending support to the price action. Traders can take an entry from the level of 131 for the target of 150 and 165 while keeping stop loss of 122 marks.

Expert: Sacchitanand Uttekar – DVP – Technical (Equity), Tradebulls Securities

Sun Pharma: Buy| LTP: Rs 531| Target: Rs 565| Stop Loss: Rs 510| Upside 6%

Sun Pharma has been sustaining well above its 200-weeks EMA placed around 515 from where it had also witnessed a major breakout from its Flag formation (continuation pattern on its weekly scale).

The recent pullback towards 20-Days EMA provides a good reward risk opportunity for fresh trading longs. Also, the occurrence of a ‘Bullish Harami’ on its daily scale compliments the support area around the 520-510 zone.

Trading longs could be considered up to 510 with a stop below 495 for a pattern target up to 565

Disclaimer: The views and investment tips expressed by experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.