"We expect sideways to bullish movement for the coming session, within a range of 11,500 on the higher side and 11,200 on the lower side," says Shabbir Kayyumi of Narnolia Financial Advisors
Narnolia Financial Advisors
Market reaction after the Monetary Policy Committee's move to hike rates was restrained, suggesting strength in the current rally. The minor correction cannot be ruled out as the Nifty is approaching the upper end of the rising channel, along with overbought levels of the relative strength index and stochastic, which indicates caution on the upside.
Nifty's five-day simple moving average (DMA) is placed around 11,325, indicating strong strength unless it trades below it. At the same time, the index has higher gap unfilled around 11,185 levels. So, the possibility of prices retracing to fill the gap cannot be ruled out.
Until the benchmark index breaches 11,300 levels decisively on the downside, it has a potential to extend this rally towards 11,450 and 11,500 levels. Recently, the Nifty has given classical cup and handle pattern breakout on the lower timeframe, which has a target of 11,450 as per the pattern.
Upper acceleration band (of 50-day daily moving average) is around 11,450, which makes 11,450 a major resistance. Also, majority of oscillators are in overbought zone, suggesting possibility of profit booking at higher levels. Option data indicates an immediate trading range between 11,500 and 11,200 levels.
We expect sideways to bullish movement for the coming session, within a range of 11,500 on the higher side and 11,200 on the lower side. However, stock-specific action in midcaps can be seen.
Aurobindo Pharma: BUY | Buy Range: Rs 595-Rs620|Target Rs 750| Stop Loss Rs 565| Upside 20%
Aurobindo Pharma has given trend line breakout. After retracing towards its foot, it bounced back on upside and now it is going to form Inverted H&S on weekly chart which is showing strength in coming sessions. Bullish crossover in MACD along with sustainability of RSI above 9 day EMA indicates bullishness in the stock in coming days. Three white soldier on daily chart also setting a bullish tone for upside. Above mentioned rationale suggest accumulating the scrip from the levels of 620 or on dip towards 595 with the stop loss of 565 for the target of 750 marks.
McDowell: BUY | Buy Range: Rs 605-Rs 610|Target Rs 735| Stop Loss Rs 540| Upside 20%
After hitting the peak of 800, stock slipped lower towards its previous resistance which should be acting as a support & chances of developing of demand is higher as it was 200 WMA too. As of now, point of polarity is giving cues to accumulate this stock at lower levels. The RSI also seems to be bottomed out near the oversold zone which can club with the divergence in RSI on weekly chart. As long as it sustains above 540, possibility of moving on upside is higher and it can hit our first target of 720 and second target is 750 with an ease from current levels.
Reliance Capital: BUY | Buy Range: Rs 405- Rs 410|Target Rs 460| Stop Loss Rs 373| Upside 13%
The scrip has been running in a falling channel since long and bottomed out near its support channel line and formed a tweezers bottom at lower levels. As of now, it has been forming pole and flag pattern on daily chart since last few days. Sustainability of RSI above 50 and positive crossover in MACD above reference line are giving cues of breakout on the upside. One can buy this scrip from the bottom line of Flag mast which comes around 405-410 levels with the stop loss of 373 for the target of 450 and 470 levels.
Piramal Enterprises. : BUY | Buy Range: Rs 2750-2760|Target Rs 3030| Stop Loss Rs 2627| Upside 10%
Piramal Enterprises- has given falling channel breakout after giving short-term consolidation on the daily chart. From last few days, it has been trading above its congestion zone after giving double bottom breakout and retest the neck line of double bottom creates buying opportunity in the scrip again. Moreover, the sustainability of RSI above 9 days EMA giving cues for upside momentum. Strong support is seen near 2627 levels too. By looking at all these factors, trader and investor can buy this scrip around 2750-2760 with the stop loss 2627 for the target of 3000 and 3060 levels.
OFSS: BUY | Buy Range: Rs 3950-Rs 3970|Target Rs 4325| Stop Loss Rs 3750| Upside 9%
Currently stock is trading above short term, midterm moving averages which shows strength in the scrip. It has given breakout with spurt in volume which is showing upside momentum in coming sessions. Indicators and oscillators are lending support to its price action. Formation of strong bull candle suggesting positive rhythm in the scrip. By looking at these factors one can buy OFSS at 3970 -3950 with stop loss of 3750 for the target of 4300-4350.Disclaimer: The author is Head - Technical & Derivative Research, Narnolia Financial Advisors. 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.