The S&P BSE Sensex fell by about 6.5 percent from the highs while Nifty50 crashed by 5.8 percent during February 16-26 period. Both the benchmark indices hit their respective record highs on February 16. Sell-off in the last 8 trading sessions pushed Nifty50 below its crucial support placed at 14,550 while the S&P BSE Sensex closed below 50,000 mark for the week ended Februry 26.
The market is throwing signs of trend reversal, hence, experts advise traders to remain cautious and be stock-specific.
A dip was on the cards because Nifty50 was trading in the overbought zone and some correction or a dip was warranted. Weak global cues led to some nervousness among equity participants but the larger trend is still intact, suggest experts.
“Looking at the price structure, we expect this correction to extend towards 14,200 – 14,000 levels first. Here, 14,000 would be seen as crucial ‘Trend Line’ support and a breach of this would open up further space towards 13,700 – 13,500,” Sameet Chavan, Chief Analyst-Technical and Derivatives, Angel Broking told Moneycontrol.
“We would be closely observing how index behaves around 14,000 in the forthcoming week. For us, the short-term tide has turned downwards and the view will remain intact as long as 15,200 is not broken. On the immediate basis, 14,750 – 14,920 are to be seen as stiff hurdles,” he said.
Chavan further added that traders should not get intimidated if all the above-mentioned scenarios turn into a reality because the larger degree uptrend is still very much intact. “Momentum traders should avoid aggressive or leveraged longs for a while and rather use decent declines to accumulate quality propositions with the broader view,” he said.
Here is a list of the top 10 short-term trading ideas from different experts for the March series:
Expert: Sameet Chavan, chief analyst-technical & derivatives, Angel Broking
NTPC | Buy | LTP: Rs 107.05 | Target price: Rs 118 | Stop loss: Rs 94.50 | Upside: 10%
PSU stocks have been on a roll for the last couple of months and the way they are shaped up, they may perform well throughout this year.
NTPC is considered to be a slow-moving counter and has shown some interesting signs in the recent past.
Looking at the daily and weekly timeframe charts, we can see a good accumulation pattern getting developed over the last few months.
The stock is about to come out of the congestion zone and hence, we expect it to give a decent move in the coming weeks.
Since the overall market look poised for some short-term correction, we advise accumulating this stock on declines around Rs 103–100 for a target of Rs 118.
Bajaj Finance | Sell | LTP: Rs 5,243.55 | Target price: Rs 5,080 | Stop loss: Rs 5,460 | Downside: 3%
The sell-off on Friday was mainly led by the financial space and some of the NBFC stocks became the casualties in the hammering.
This stock had a gradual decline in the last couple of weeks but on Friday with a nearly 5 percent cut, it finally broke down below its recent swing lows.
The momentum oscillators on the daily chart have turned downwards which may provide some pressure to the prices on any bounce back.
ICICI Bank | Sell | LTP: Rs 597.25 | Target price: Rs 564 | Stop loss: Rs 615.60 | Downside: 6%
Last week, this stock managed to lead from the front in the sharp recovery to pull the Nifty above the 15,000 mark. However, the follow-up buying was missing towards the fag end of the week which eventually resulted in a sharp decline on Friday.
The chart structure is very much similar to some of the other financial stocks. On the daily chart, we can see a bearish ‘1-2-3’ pattern with prices trading convincingly below the 20-day EMA.
Expert: Shabbir Kayyumi, Head of Technical Research at Narnolia Financial Advisors Ltd.
Bharat Heavy Electricals Limited: Buy| LTP: Rs 47.65| Buy around: Rs 47|Target Rs 60| Stop Loss Rs 42 | Upside 27%
The stock witnessed an inverse Head & Shoulder breakout on the weekly chart along with the triangular pattern on the daily chart that indicates bullishness in the coming sessions.
Inclining peaks of MACD on the daily chart suggest that upside move along with +DMI has given a crossover above (-DMI) which indicates strength in the counter.
The daily RSI is also trading in the bullish horizon. With the chart looking attractive, we suggest buying this stock around 47 for a target of 60, while keeping the stop loss below Rs 42 on a closing basis.
Coal India: Buy| LTP: Rs 152| Buy around: Rs 152 |Target Rs 172| Stop Loss Rs 140 | Upside 13%
The scrip spurted from a low of 110 and gave an inverted Head and Shoulder breakout on the weekly chart that is showing pullback on the upside in the upcoming sessions.
The emerging line of polarity on the daily time frame of the chart is suggesting bullish momentum in the scrip.
Indicators and oscillators are also showing conducive scenarios in the coming sessions. Based on the mentioned technical structure one can go long in the scrip around 152 for the target of 172 marks, and a stop loss can be placed below the Rs 140 mark.
Sun Pharmaceutical Industries: Buy| LTP: Rs 595| Buy around: Rs 595|Target Rs 670| Stop Loss Rs 555 | Upside 12%
On the daily and weekly charts, the stock is showing a retest of the neckline of its earlier reversal formation which is broadly positive. The incremental volume activity post-breakout formation indicates further bounce back from the neckline.
The stock is trading well above short-term as well as medium-term averages, which indicates that an uptrend wave is likely to continue in the near-term.
One can buy the stock around 595 for the target of 670, and a stop loss can be placed below Rs 555 mark.
Expert: Likhita Chepa, Senior Research Analyst at CapitalVia Global Research.
Wockhardt: Buy| LTP: Rs 500.90| Buy above Rs 523| Target: Rs 598|Stop Loss: Rs 470| Upside 19%
This stock is trading above its 21 50, & 200-Days EMAs and the key indicators are indicating strength for a positive movement in the stock. The stock has been in a strong consolidation phase.
Any breakout above the level of 523 would add further upward momentum to the stock. Therefore, we recommend initiating a buy position above Rs. 523 with a stop loss of Rs. 470 and a target of Rs. 598.
KEC International: Buy| LTP: Rs 430| Buy above Rs 445| Target: Rs 500| Stop Loss: Rs 405| Upside 12%
This stock is forming a strong resistance around Rs. 445 and Momentum Oscillator RSI are showing positive strength in the stock. It is trading above its important moving
averages with positive crossover.
Any breakout above the level of 445 would add further upward momentum to the stock. Therefore, we recommend initiating a buy position above Rs. 445 with a stop loss of Rs. 405 and a target of Rs. 500.
Tata Motors: Buy| LTP: Rs 323| Buy above Rs 342| Target: Rs 440| Stop Loss: Rs 299| Upside 28%
This stock has been forming higher highs formation on the monthly charts and has given a major breakout recently. It is trading above its important moving averages and we expect the rally to continue.
Any breakout above the level of 342 would add further upward momentum to the stock. Therefore, we recommend initiating a buy position above Rs.342 with a stop loss of Rs.299 and a target of Rs.440.
Brokerage: SMC Global Securities Ltd
VIP Industries: Buy| LTP: Rs 401| Target: Rs 450| Stop Loss: Rs 375| Upside 12%
VIP made a 52-week low of Rs 187.65 on 24th March, 2020, and a 52-week high of Rs. 447.50 on 26th February 2020.
The 200-Days Exponential Moving Average (DEMA) of the stock on the daily chart is currently at Rs 333.01. The stock formed a “Bull Flag” pattern on the weekly charts which is considered to be bullish.
Last week, the stock ended with gains of over 6 percent and conclusively gave a breakout from the pattern along with high volumes. Further upside is anticipated from current levels.
Therefore, one can buy in the range of 394-397 levels for the upside target of 440-450 levels, and a stop loss can be placed below 375.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.