The benchmark indices rebounded smartly from a two-month low, with the Nifty 50 rising 0.4 percent on October 18 after three days of losses; however, the market breadth was weak. About 1,311 shares declined against 1,183 shares that advanced on the NSE. The index may extend its upward trend in the upcoming session but overall remains consolidative. Below are some trading ideas for the near term:
Rajesh Palviya, Senior Vice President Research (Head Technical Derivatives) at Axis Securities
Multi Commodity Exchange of India | CMP: Rs 6,561
MCX India is in a strong uptrend across all time frames, forming a series of higher tops and bottoms, indicating bullish sentiment. The stock is well positioned above its 20, 50, 100, and 200-day SMA (Simple Moving Average), which are also inching up along with the price rise, reaffirming the bullish trend. The daily, weekly, and monthly strength indicator RSI (Relative Strength Index) is in positive territory, justifying the rising strength across all time frames. Investors should buy, hold, and accumulate this stock with an expected upside of Rs 7,000-7,150, with a downside support zone of Rs 6,280-6,000.
Strategy: Buy
Target: Rs 7,000, Rs 7,150
Stop-Loss: Rs 6,280
Hindalco Industries | CMP: Rs 753.5
On September 26, Hindalco decisively broke out of an "Inverse Head and Shoulder" formation at the Rs 718 level on a closing basis. With the price action over the past three weeks, the stock managed to hold the neckline support and rebounded sharply. Recently, the stock has recaptured the 20-day SMA support of Rs 733 and bounced sharply. The daily, weekly, and monthly strength indicators RSI are also in positive territory, reinforcing the bullish sentiment. Investors should buy, hold, and accumulate this stock with an expected upside of Rs 800-835, with a downside support zone of Rs 725-710.
Strategy: Buy
Target: Rs 800, Rs 835
Stop-Loss: Rs 725
Samvardhana Motherson International | CMP: Rs 205
On the daily chart, Samvardhana Motherson International is trending within an "up-sloping channel," indicating a bullish trend. The stock is in a strong uptrend across all time frames, forming a series of higher tops and bottoms, showing bullish sentiment. The stock is well positioned above its 50, 100, and 200-day SMA, which are also moving up along with the price rise, reaffirming the bullish trend. Investors should buy, hold, and accumulate this stock with an expected upside of Rs 223-232, with a downside support zone of Rs 195-190.
Strategy: Buy
Target: Rs 223, Rs 232
Stop-Loss: Rs 195
Rajesh Bhosale, Technical Analyst at Angel One
Tube Investments of India | CMP: Rs 4,489
For the past few months, Tube Investments of India prices have been trading within a range of Rs 4,400 to Rs 3,900. However, last week (ended October 18), they broke above the upper end, confirming a bullish breakout. This pattern is known as a channel breakout, and following the recent consolidation, the stock appears poised for strong upside, potentially moving into uncharted territory. Prices are well above key moving averages, and oscillators remain in the positive zone, reinforcing the buy signal. Hence, we recommend buying Tube Investments of India around Rs 4,480-4,470.
Strategy: Buy
Target: Rs 4,800
Stop-Loss: Rs 4,300
HDFC Life Insurance Company | CMP: Rs 742.5
HDFC Life Insurance Company had already shown a bullish breakout on the weekly chart but consolidated within a range due to subdued market conditions. Last week, prices broke out of a continuation pattern known as a Pennant. The increase in volume over the last few sessions further supports this breakout. Additionally, both the daily and weekly RSI (Relative Strength Index) have crossed above 60, signaling strong positive momentum. Hence, we recommend buying HDFC Life Insurance Company around Rs 743-740.
Strategy: Buy
Target: Rs 800
Stop-Loss: Rs 714
Torrent Power | CMP: Rs 1,973.65
Torrent Power prices have consistently followed a positive trend, forming higher tops and higher bottoms. Over the past few weeks, prices struggled around Rs 1,960, but last week they closed above that level, entering uncharted territory in this sluggish market, indicating inherent strength. We anticipate this outperformance to continue, given the price structure and positive signals from various indicators. Hence, we recommend buying Torrent Power around Rs 1,974-1,970.
Strategy: Buy
Target: Rs 2,120
Stop-Loss: Rs 1,904
Jigar S Patel, Senior Manager - Equity Research at Anand Rathi
BEML | CMP: Rs 4,039
BEML has recently formed a Triple Bottom pattern near its 200-day Exponential Moving Average (DEMA), indicating strong support at this level. This is coupled with a bullish divergence in the daily RSI, a sign that the stock's downward momentum is weakening, making the setup more attractive for potential buyers. In the latest trading session, BEML broke past its previous swing high of Rs 3,900 and has managed to sustain above that level, further strengthening the bullish outlook. As a result, we recommend entering a long position in the stock between Rs 4,000 and Rs 4,050, targeting an upside of Rs 4,500. A stop-loss should be placed at Rs 3,780 on a daily closing basis to limit downside risk.
Strategy: Buy
Target: Rs 4,500
Stop-Loss: Rs 3,780
Mazagon Dock Shipbuilders | CMP: Rs 4,526.4
Since reaching a peak of Rs 5,843 on July 5, 2024, Mazagon Dock has formed a series of lower highs and lower lows, leading to a significant 34 percent correction in its price. Currently, the stock has found support at its 100-day (DEMA) and has formed a double bottom pattern, which is a bullish reversal signal. In the previous trading session, Mazagon Dock also broke through a descending trendline, further enhancing its attractiveness from a technical perspective. Additionally, the RSI has risen above the 50 level, which previously acted as resistance and now serves as support. Given these factors, we recommend buying Mazagon Dock in the price range of Rs 4,475 to Rs 4,530, with an upside target of Rs 4,950. A stop-loss should be placed at Rs 4,275 on a daily closing basis to manage risk.
Strategy: Buy
Target: Rs 4,950
Stop-Loss: Rs 4,275
JK Paper | CMP: Rs 489.55
Over the past month, JK Paper has been trading in a consolidation range between Rs 445 and Rs 475, and it has recently broken out of this zone, indicating potential upward movement. Notably, this consolidation phase occurred between the 100-day and 200-day DEMA, which is considered a positive technical signal, as it suggests a stable base for further gains. Additionally, the RSI, which had been consolidating between 40 and 50, has also given a breakout and is now retesting 52-53 levels. Based on these indicators, it is recommended to take a long position in the stock within the Rs 482 to Rs 492 range, targeting an upside of Rs 535, with a stop-loss at Rs 463 on a daily closing basis to manage risk.
Strategy: Buy
Target: Rs 535
Stop-Loss: Rs 463
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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