A smart recovery from the week's low point helped the market cut down losses and close half-a-percent down for the week ended December 22. The Nifty 50 snapped seven-week winning streak, but did not fall below the previous week's low and continued higher highs, higher lows for the fourth consecutive week.
The market seems to have entered into a consolidation mode with hurdle on the higher side at 21,593, the record high, and the support for the Nifty 50 on the lower side at the 21,200-21,000 levels. If the index sees a breakout, then 21,600-21,800 can be the levels to watch out for, whereas breaking of 21,000 can drag the index towards the 20,800 levels, experts said.
"Notably, the bounce from lower levels indicate a strong support around the 21,000 - 20,950 zone, which is technically significant with a bullish gap on the daily chart. Going ahead, this zone may act as an immediate base, and only a break below it could trigger a market correction," Sameet Chavan, who is the research head for technicals and derivatives at Angel One, said.
On the positive side, he feels the Nifty tested the 200 percent reciprocal retracement of the October fall around 21,600, which is considered a pattern target.
Despite a positive undertone, the market appears to be in a corridor of uncertainty, and trading within the mentioned broad range is expected in the truncated week ahead of the new year, he said, adding traders are cautioned to monitor these levels and adjust their trading strategies accordingly.
Om Mehra, technical analyst at SAMCO Securities, also advised caution as certain sectors appear to be in the overbought territory potentially setting the stage for profit-booking. This could notably impact mid and small-cap equities, he feels.
Technically, Mehra feels, the Nifty exhibited resilience by holding onto the crucial 21,000 mark following a sharp one-day decline and this level is now perceived as a strong support. On the higher side, if it breaks 21,600, the Nifty might attempt to test new highs around the 21,750-21,800 zone.
Moneycontrol collated a list of top 10 stock ideas from experts, which can give healthy return in the next 3-4 weeks. The closing price of December 22 considered for the calculation of stock returns.
Expert: Vinay Rajani, senior technical and derivative analyst at HDFC Securities
Intellect Design Arena: buy | LTP: Rs 811.70 | Stop-Loss: Rs 748 | Target: Rs 900 | Return: 11 percent
In the current month, the stock has broken out from previous three month’s price consolidation. The stock is placed above all important moving averages, indicating bullish trend on all time frames.
The price breakout is accompanied with jump in volumes on monthly basis. IT Sector has started outperforming and the same is likely to continue in coming days.
GSFC: Buy | LTP: Rs 224 | Stop-Loss: Rs 206 | Target: Rs 270 | Return: 20 percent
Gujarat State Fertilizers & Chemicals (GSFC) price retraced back to the previous breakout level and has shown throwback. Stock price is placed above all important moving averages, indicating bullish trend on all time frames.
Indicators and oscillators like DMI (directional movement index) and RSI have turned bullish on the daily charts. Price breakout is accompanied with jump in volumes. Fertilizer sector has started outperforming.
Global Health: Buy | LTP: Rs 974 | Stop-Loss: Rs 910 | Target: Rs 1,095 | Return: 12 percent
After running correction, the stock has resumed its uptrend with rise in volumes. The stock has formed strong base at Rs 910 with multiple bottoms near that level and turned north.
Indicators and Oscillators like DMI and RSI have turned bullish on the daily charts. Price breakout is accompanied with jump in volumes.
Expert: Omkar Patil, technical & derivatives analyst - institutional equity at Ashika Group
Bharat Electronics: Buy | LTP: Rs 174.8 | Stop-Loss: Rs 168.6 | Target: Rs 195 | Return: 12 percent
The BEL stock is presently at an all-time high, indicative of a robust and accelerating momentum in its trend. The steepness of the trend has notably increased, signifying a growing momentum.
Recent observations show a surge in trading volume, suggesting a substantial build-up of long positions in the stock. Additionally, during the stock's recent pullback, the short-term average provided support, accompanied by a piercing line candlestick pattern, affirming the prevailing uptrend.
Going ahead, we expect the prices to move higher till the mark of Rs 195 where the stop-loss must be Rs 168.6 on a daily closing basis.
Hindalco Industries: Buy | LTP: Rs 570.45 | Stop-Loss: Rs 549 | Target: Rs 620 | Return: 9 percent
Hindalco has successfully breached a significant resistance level at Rs 510, signaling the commencement of an upward trend. The stock has entered a pattern marked by higher highs and higher lows, indicative of a structured upward movement.
Furthermore, the MACD (moving average convergence divergence), positioned above the zero line, affirms the presence of positive momentum within the ongoing uptrend.
Going ahead we expect the prices to move higher till the mark of Rs 620, where the stop-loss must be Rs 549 on a daily closing basis.
Torrent Pharmaceuticals: Buy | LTP: Rs 2,222.5 | Stop-Loss: Rs 2,140 | Target: Rs 2,445 | Return: 10 percent
Torrent Pharma is currently exhibiting a trading pattern within an ascending channel, characterized by the formation of successive higher highs and higher lows. Notably, there has been a recent breakout from a Cup & Handle pattern, signaling the initiation of an upward trend.
The stock is trading above significant key averages, underscoring its strength, and the positive cross observed in the MACD reinforces the presence of a positive trend.
Going ahead, we expect the prices to move higher till the mark of Rs 2,445, where the stop-loss must be Rs 2,140 on a daily closing basis.
Expert: Shrikant Chouhan, head – equity research at Kotak Securities
Infosys: Buy | LTP: Rs 1,563 | Stop-Loss: Rs 1,505 | Target: Rs 1,670 | Return: 7 percent
On the daily scale, after the recent up move the stock is trading in a sideways movement forming a Flag chart pattern. The stock is representing a bullish continuation chart structure which indicates at a new leg of up move is likely to resume from the current levels in the coming horizon.
Jindal Steel & Power: Buy | LTP: Rs 726.4 | Stop-Loss: Rs 700 | Target: Rs 780 | Return: 7 percent
Post decline from the higher levels, the counter rebounded from its demand zone and witnessed a steady recovery from the lower levels. Additionally, on the daily charts, the counter has given a breakout from its sloping trend line.
The gradual up moves in the counter suggest a new leg of bullish trend from the current levels.
SBI Life Insurance Company: Buy | LTP: Rs 1,394 | Stop-Loss: Rs 1,350 | Target: Rs 1,500 | Return: 8 percent
After the remarkable up move of the last few weeks, the counter witnessed short-term correction from the higher levels. However, closing above the important retracement levels suggest bullish continuation chart formation.
Therefore, the counter is likely to resume its uptrend from the current levels in the near term.
Expert: Om Mehra, technical analyst at SAMCO Securities
ICICI Lombard General Insurance: Buy | LTP: Rs 1,422.6 | Stop-Loss: Rs 1,360 | Target: Rs 1,535 | Return: 8 percent
The stock is currently trading in a consolidating range of Rs 1,410-1,470 with strong support at Rs 1,400.
The recent retracement towards the previous swing low arises with lower volumes signalling a controlled pullback while the increasing delivery volumes indicate the strength in price action.
A positive crossover of the daily stochastic indicator highlights the bullish trend. This indicator, in addition to confirmation of a bullish primary trend, indicates a favourable setup.
Additionally, the 40-and 50-period exponential moving averages (EMA) collectively provide a robust base, indicating a solid foundation for the stock's price movements. This stability is further supported by the MACD indicator on the weekly chart which continues to exhibit sustained positivity.
We anticipate that the stock to scale higher towards Rs 1,535. Stop-loss can be kept at Rs 1,360.
Astral: Buy | LTP: Rs 1,933.9 | Stop-Loss: Rs 1,860 | Target: Rs 2,070 | Return: 7 percent
Astral witnessed a noteworthy surge at the end of the week accompanied by substantial trading volumes. Following a period of consistent consolidation. The stock has maintained its price level above the 50-day exponential moving average (EMA), indicating a positive momentum shift. Notably, it recovered from the Fibonacci retracement level of 61.8 percent based on the Rs 1,870 levels.
In the daily chart, the stock is currently trading above the middle Bollinger band, showcasing strength in the stock. The RSI is in recovery mode from lower levels, suggesting a potential upward push in the near term.
Hence, based on the above technical structure, one can initiate a long position at current market price Rs 1,933.9 for the target price of Rs 2,070 with a stop-loss of Rs 1,860.
Disclaimer: The views and investment tips expressed by investment 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.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
