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Bulls continued having an upper hand throughout the week but some profit booking was seen ahead of extended weekend.
Bearish candle on Thursday’s session resulted in a formation of 'Dark Cloud Cover' candlestick pattern and considering the gap on daily chart, we can expect the profit booking to continue further till 11,695.
As per the Fibonacci projections, the short term target of Nifty50 is 12,000 and in upcoming week if 11,856 trades on higher side then we could see a smooth journey towards the target level. Nifty50 closed with the weekend gain of approximately 1 percent at 11,752.8.
Moving ahead, the bullish trend in short term is still intact and until we are trading above 11,540 there is a high probability that we can touch 12,000 level in coming days. Momentum indicators on daily as well as weekly chart are trading in bullish zone and RSI on daily chart has bounced back from the support level of 60.
Being technical part supportive, besides, steady influx by FIIs' in the Indian market to the tune of Rs 14,300 crore in the first half of April month itself would further trail the stock market. In addition, the trade deficit data for the month of March narrowed to $10.9 billion (YoY) would aid rupee appreciation for the coming days. Thus, positive momentum is likely in near term.
Option chain also suggesting a buying at lower levels as 11,500 PE holds highest cumulative open interest whereas immediate resistance is visible at 12,000 where around 6.5 lakh contracts has been added in open interest and cumulative open interest is more than 31 lakhs.
Four stocks that could fetch 6 to 9 percent return in short term:
Reliance Industries: Buy | CMP: Rs 1,385.95 | Target: Rs 1,470 | Stop Loss: Rs 1,338 | Return: 6%
After forming a bullish 'Cup and Handle' formation stock has retraced till neckline and bounced back. On Thursday, stock has formed kind of bullish “kicker” pattern. Bullish flag pattern in also visible on the chart.
RSI on daily chart has started trading in a bullish zone which suggests that after a sideways move the stock is getting ready for a new move. Apart from this, volume breakout is also visible and the ADX curve has started sloping upwards.
JK Paper: Buy | CMP: Rs 150.5 | Target: Rs 163 | Stop Loss: Rs 143 | Return: 9%
Stock is giving a signal of trend reversal buying as per Guppy multiple moving average system. There is a crossover of major short term and long term moving averages ribbon. Stock has also broken out of a declining trend line. MACD is generating buy signal and trading above signal line.
After falling trend line breakout stock has taken support at 20-Day Moving Average and now bouncing back and offering prudent short term buying opportunity.
SAIL: Buy | CMP: Rs 57.35 | Target: Rs 63 | Stop Loss: Rs 54 | Return: 9%
Stock has given a inverse “Head and Shoulder” breakout and retraced back till neckline with formation of bullish “doji” pattern. In addition, RSI shows bottoming out signal and volume has also increased substantially on a monthly chart.
Momentum indicators are trading in bullish zone and stock is trading above all major moving averages. Thus long position can be initiated in the counter with short term perspective.
DCB Bank: Buy | CMP: Rs 202.3 | Target: Rs 215 | Stop Loss: Rs 196 | Return: 6%
Stock has bounced back sharply from 50-day exponential moving average. Momentum indicators suggesting that stock is likely to break out of a rounding bottom formation. Volume breakout has been witnessed in the counter on Thursday’s trading session.
On weekly chart, RSI has started trading in bullish zone after several weeks and turning upward from important support levels. The pattern is suggesting a reversal after retracement. Stock can be bought with a short term perspective with a target of Rs 215.
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