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The bears had an upper hand in Thursday’s trading session as they were successful in pushing the Nifty50 below its key short-term moving averages. The index closed 50 points lower at 10,360.
After defending the 200-DMA last week, the bulls showed some resilience and rebounded sharply during the initial part of the week.
However, the up move got restricted near its daily 45-EMA and we saw quick profit booking during the mid-part.
The daily 9, as well as 45 days exponential moving averages on price, is negative; hence, the immediate trend looks negative.
However, on a medium-term basis as long as the index is trading above 10033 which coincides with the weekly swing low and the weekly 45-EMA the overall trend is still up.
Going forward, Nifty has an immediate support near 10285 and if it sustains below this level will lead to a further correction towards 10210 and 10141 levels respectively.
On the other side, 10478 will act an immediate hurdle above which the index likely to rally towards 10630.
Here is a list of top buy or sell trading ideas which could give up to 18 percent return in the short term:
Analyst: Aditya Agarwal, Head Technical Research, Way2Wealth Brokers Pvt. Ltd.
Tata Steel: Sell around 615 – 620| Target 560| Stop Loss 648| Time frame 15 to 21 sessions| Return 8 percent
Looking at the daily chart, the stock has formed a Bearish Head & shoulder pattern and during last Friday, the stock confirmed its breakdown as it broke the neckline of the said pattern.
The daily RSI (14) convincingly broke the 40 levels. Recently, the stock had seen a pullback from its oversold zone, but the up move resisted near the neckline of said pattern.
Considering the above evidence, traders can go short in the range of 615 to 620 with a price target of 560 and a stop loss placed above 648.
Motherson Sumi: Sell around 315 – 318| Target 295| Stop loss 330| Time frame 15 to 21 trading sessions| Return 6 percent
Looking at the daily chart, the stock has been under tremendous pressure and nosedived sharply from its all-time high of 395.60. Subsequently, the stock found support near 301 and rebound from its oversold zone.
Traders are advised to go short in a range of 315 – 318 with a price target of 295 and Stop loss placed at 330 on a closing basis.
Divi’s Laboratories Ltd: Buy around 1075 – 1060| Target 1260| Stop loss 978| Timeframe 15 to 21 trading session| Return 16 percent
On the weekly chart, the stock has been consolidating a range of 1140 to 980 and the lower band of the range coincided with the multiple supports.
Recently, Davis lab saw strong buying interest and as a result, stock surpassed its weekly swing high. Looking at the weekly chart, the Bollinger band has compressed significantly indicating shift in volatility.
Traders are advised to buy this stock in a range of 1075 to 1060 with a price target of 1260. A stop loss should be placed below 978.
MAJESCO: Buy around 475- 470| Target 565| Stop loss 440| Time frame 15 to 21 trading session| Return 18 percent
After posting a fresh 52-weeks high of 604, the stock corrected gradually in past few weeks. However, the fall got arrested near 440, as this level coincided with its previous resistance zone.
In line with the expectation, stock saw a decent bounce from its support zone. The weekly RSI (14) has signaled an oversold position. Traders can accumulate this stock in a range of 475 to 470 with a price target of 565. A stop loss should be placed below 440.
Analyst: Hadrien Mendonca, Senior Technical Analyst, IIFL
Quick Heal Technologies Ltd: BUY| Target Rs 335| Stop Loss 320| Returns 9 percent
The stock has been under pressure for the past nine weeks and has finally broken out from a declining channel pattern on the daily chart.
The decline was arrested as it found support around its long-term 200-DMA. The price breakout has also been accompanied with a smart uptick in traded volumes.
In addition, Quick Heal has convincingly managed to hold above its short-term averages too. We expect the stock to make a dash towards its potential target of 335 levels in the medium term.
Future Retail: BUY| Target Rs 610| Stop Loss 538| Returns 11 percent
The stock has gone through constant selling pressure since hitting its all-time high of Rs 656 in November end 2017. The stock has been consolidating between a range of Rs 470-530 creating a Rectangular channel pattern.
The recent strong upmove has finally aided Future Retail to breakout from this channel. Volumes have also been accompanied the strong upmove. We expect the stock to move higher towards its potential target of Rs 610 in the medium term.
Eveready Industries Ltd: BUY| Target Rs 443| Stop Loss 395| Returns 8 percent
Six weeks of consolidation finally seems to be coming to an end as the stock has formed a Double Bottom formation and has staged a strong come back. The stock has witnessed a constant rise in traded volumes.
The recent move has also aided Eveready to move above the short-term moving averages. The stock has also witnessed a bullish Thee White Soldiers candlestick pattern on the daily chart further accentuating our bullish stance on the stock.
Disclaimer: The views and investment tips expressed by investment experts on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
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