The rally driven by the Reserve Bank of India monetary policy failed to compensate the heavy losses incurred due to rising expectations for more rate hikes in the US to fight inflation and more than seven-year high oil prices.
As a result, the Nifty50 fell 0.8 percent to 17,375 in the week ended February 11, weighed by all sectors barring metals. The broader markets - the Nifty Midcap 100 and Smallcap 100 indices - fell more than 2 percent each.
Overall, the index has been gyrating in a range of 17,000 to 17,600-17,800 for last few weeks with 17,000 acting as a crucial support and 17,800 as a big hurdle. The breaching either side of a range could give direction to the market and till then there could be continuity in volatility, experts feel.
"Till the time, the global uncertainty looms over, we are likely to have challenging scenarios in the market where the volatility is also expected to stay on the higher end," says Sameet Chavan, Chief Analyst-Technical and Derivatives at Angel One.
On technical aspects, he feels 17,000 is expected to act as the key demand zone as it is being backed by the supporting trend line. "And, till the market is holding the mark, we remain hopeful for a strong resurgence. On the higher end, 17,650 is a crucial supply area and if the market manages to surpass the same in a decisive manner, then we might witness reinforcement in the momentum and could expect Nifty to test the psychological 18,000 mark in the near future."
Until the decisive breakout is not seen, one should expect a rangebound movement and focus on stock-specific action, said Chavan.
Here are top 10 trading ideas by experts for the next 3-4 weeks. Returns are based on the February 11 closing prices:
Expert: Subash Gangadharan, Senior Technical and Derivative Analyst at HDFC Securities
Coal India: Buy | LTP: Rs 166.50 | Stop-Loss: Rs 158 | Target: Rs 188 | Return: 13 percent
Coal India has recently reversed its downtrend by crossing its previous swing highs of Rs 153.75 during the first week of January 2022. The stock has subsequently been consolidating in a range of Rs 154-168 for the last few weeks. Last week, the stock broke out of this range on the back of above average volumes. This augurs well for the uptrend to continue.
Technical indicators are giving positive signals as the stock is trading above the 20-day and 50-day SMA (simple moving average). Momentum readings like the 14-week RSI (relative strength index) too are in rising mode and not overbought, which implies potential for further upsides.
With the intermediate technical set up too looking attractive, we expect the stock to move up towards its previous intermediate highs in the coming weeks. Buy between the Rs 164-168 levels. The stop-loss is at Rs 158 while target is at Rs 188.
Pidilite Industries: Sell | LTP: Rs 2,432.25 | Stop-Loss: Rs 2,500 | Target: Rs 2,290 | Return: 6 percent
Pidilite is in a short term downtrend as it has been consistently making lower tops and lower bottoms for the last few weeks after breaking the support of Rs 2,660.
On Friday, the stock reacted from the 50-day SMA and ended lower on the back of above average volumes.
With the stock trading below key moving averages like the 20 and 50 day SMA, the 14-week RSI in decline mode and the intermediate technical setup looking negative, we believe the stock is headed lower in the coming weeks.
We therefore recommend a sell between the Rs 2,420-2,450 levels. The stop-loss is at Rs 2,500 while downside target is at Rs 2,290.
Havells India: Sell | LTP: Rs 1,174.75 | Stop-Loss: Rs 1,230 | Target: Rs 1,050 | Return: 10.6 percent
Havells is in an intermediate downtrend as it recently broke the support of Rs 1,253 and has been moving lower in the last few weeks. This week, the stock reacted from the 200-day EMA (exponential moving average) and broke its recent supports on Friday on the back of above average volumes. This indicates that selling was intense.
Technical indicators are giving negative signals as the stock is now trading below the 20-day SMA, 50-day SMA and 200-day EMA. Momentum readings like the 14-week RSI are in decline mode and not oversold, which implies potential for more downsides.
We therefore expect the stock to correct further in the coming sessions. Sell between the Rs 1,160-1,180 levels. The stop-loss is at Rs 1,230 while downside target is at Rs 1,050.
Expert: Shrikant Chouhan, Head of Equity Research (Retail) at Kotak Securities
Pidilite Industries: Sell | LTP: Rs 2,432.25 | Stop-Loss: Rs 2,500 | Target: Rs 2,250 | Return: 7.5 percent
On a weekly basis, the stock closed below the Rs 2,500 support level, which has changed the trading range to after a period of six months, which is negative in the short term.
It has also been forming a series of lower tops and bottoms since the stock formed an all-time high of Rs 2,700. Based on this, the stock may drop to Rs 2,250 in the near term. We advise to sell for now and till Rs 2,475. For this put a stop-loss at Rs 2,500.
Wipro: Sell | LTP: Rs 561.45 | Stop-Loss: Rs 575 | Target: Rs 510 | Return: 9.2 percent
The stock is on the verge of exiting the triangle formed at the bottom of the sell-off recently. The stock is already trading below the support of the 200-day SMA, which is an indication that the stock is in weak hands and may be prone to repeated selloffs.
Below the Rs 560 level, the stock may gradually fall to Rs 538, which was the previous lowest level for it. In the worst-case scenario, it may fall to Rs 515. Sell below the Rs 560 level and place a stop-loss at Rs 575.
Fortis Healthcare: Buy | LTP: Rs 259.20 | Stop-Loss: Rs 244 | Target: Rs 285 | Return: 10 percent
As per the daily chart, the stock is trying to bear the selling pressure. On Friday, despite the stock having managed to reversal from the support of the 200-day SMA, it finally closed below the previous day's close. However, looking at the volume pattern, we believe that the stock has formed a bullish reversal and we will see upward movement in the near term.
Buying advice is given at current levels and a downside break near Rs 250 is given with stop-loss at Rs 244. At higher levels, it may travel to Rs 280-285, where it has resistance at the 20-day SMA.
Expert: Anuj Gupta, Vice President at IIFL Securities
Tata Power: Buy | LTP: Rs 232.30 | Stop-Loss: Rs 190 | Target: Rs 300 | Return: 29 percent
On the monthly chart of Tata Power, we have observed that it is trading on a positive note from last couple of months. We have seen that prices are also trading above its 50-month moving averages.
Substantial volumes coupled with the bullish chart structure suggesting the optimism in the stock. Here we are recommending buy in the stock. One can buy and accumulate this stock around Rs 225-230 levels with the stop-loss of Rs 190 for the target of Rs 280-300 levels.
Balrampur Chini Mills: Buy | LTP: Rs 427.05 | Stop-Loss: Rs 390 | Target: Rs 500 | Return: 17 percent
On the monthly price chart of Balrampur Chini, we observed that prices are forming bullish candlestick pattern. Prices are formed higher top higher bottom formation which is the sign of bull trend.
Prices are also trading above its 50-month moving average which is showing the positive momentum in the stock.
Looking towards the bull trend of the stock, we are recommending buy in the stock. One can buy this stock around Rs 415 to Rs 420 levels with the stop-loss of Rs 390 for the target Rs 480-500 levels.
Divis Labs: Buy | LTP: Rs 4,291.25 | Stop-Loss: Rs 4,100 | Target: Rs 4,600 | Return: 7 percent
As per the weekly prices chart of Divis Labs, it is clearly seen that prices have corrected after making a life-time high of Rs 5,425 levels. As per the trend line prices are taking strong support on the long term trend line. In last two weeks prices have taken support on the trend line and recovered. Now we are expecting that the bull trend may continue.
Looking towards bull trend of chart followed by the long term trend line we are recommending buy in this stock. One can buy this stock around Rs 4,250-4,260 with the stop-loss of Rs 4,100 for the target of Rs 4,500-4,600 levels.
Bank of Baroda: Buy | LTP: Rs 113.55 | Stop-Loss: Rs 89 | Target: Rs 150 | Return: 32 percent
On the technical chart of Bank of baroda, we have observed that prices are in bullish trend as it breached a consolidation pattern “Cup and Handle Pattern”. In last week prices have breached the pattern and trading above it. Volumes are substantial and in rising mode which is supportive for the rising prices.
Looking towards the bullish chart structure, we are recommending buy in this stock. One can buy this stock at current market prices with the stop-loss of Rs 89 for the target of Rs 145-150 levels.
Expert: Sameet Chavan, Chief Analyst-Technical and Derivatives at Angel One
BSE: Buy | LTP: Rs 2,271.40 | Stop-Loss: Rs 2,100 | Target: Rs 2,500 | Return: 10 percent
BSE Limited has been in a secular uptrend and is comfortably hovering above all its exponential moving averages on the daily chart. In the previous week, the stock has witnessed a volume-based trendline breakout maintaining its bullish view.
The overall structure construes to remain bullish biased in the counter, and the recent traction indicates the potential to enter the unchartered territory in the near term.
Hence, short-term investors can look to accumulate on minor dips for a near-term target of Rs 2,500. The stop-loss can be placed at Rs 2,100.
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.
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