Global woes dampened market sentiment, leading to a 2.7 percent correction in benchmark indices on August 5. The Nifty 50 continued its pattern of lower highs and lower lows for another session, forming a long bearish candlestick pattern on the daily charts. Consequently, the index is likely to extend losses, with a downside target towards 23,600. On the NSE, 2,209 shares declined, while 192 shares advanced. Below are some trading ideas for the near term:
Jay Thakkar, Vice President & Head of Derivatives and Quant Research at ICICI Securities
United Spirits | CMP: Rs 1,400
United Spirits has been consolidating in a falling channel, and the current consolidation appears to be in its wave 4. A breakout to the upside is likely, as the stock could withstand market sell-offs. The momentum indicator MACD (Moving Average Convergence Divergence) is in buy mode in the short term.
Strategy: Buy
Target: Rs 1,450, Rs 1,480
Stop-Loss: Rs 1,360
Wipro | CMP: Rs 485
Wipro has started forming a pattern of lower tops and lower bottoms, with a sell crossover in its momentum indicator MACD in the short time frame. The stock has also experienced short build-up following Q1 results that fell short of market expectations. Significant Call writing at higher levels will likely act as resistance for the stock.
Strategy: Sell
Target: Rs 460, Rs 450
Stop-Loss: Rs 505
SRF | CMP: Rs 2,473
SRF has reversed from the upper end of its sideways consolidation, and the momentum indicator has seen a negative crossover in the short term. With short build-up observed, the trend is likely to remain sideways to negative.
Strategy: Sell
Target: Rs 2,350
Stop-Loss: Rs 2,530
Ashish Kyal, CMT, Founder and CEO at Waves Strategy Advisors
Pokarna | CMP: Rs 816.65
Pokarna has been moving higher recently and remains in a strong uptrend. In the previous session, it closed with a gain of 5.93 percent, despite broader market declines. The daily chart shows a bullish candle formed in the previous session. The price has closed above Rs 797, confirming the breakout of a rounding bottom pattern. The ADX (Average Directional Index) indicator, which signals whether a stock is trending or in a trading range, has a reading of 28.40, indicating a trending market. A reading above 25 suggests strong directional strength. The trend for this stock is positive; use dips towards Rs 800-810 as a buying opportunity for a move towards Rs 890-900, as long as Rs 770 holds on the downside.
Strategy: Buy
Target: Rs 890, Rs 900
Stop-Loss: Rs 770
Container Corporation of India | CMP: Rs 978
On the daily chart, Container Corporation opened with a gap down in the previous session, closing down by 5.03 percent. The stock has formed a symmetrical triangle pattern and has given a breakdown, suggesting a negative undertone. Prices have breached the lower band of the Bollinger Bands, and as the indicator is widening, it signals bearish sentiment and high volatility. Wave (ii) is moving downward and has retraced more than 50 percent of the prior leg. We expect it to retrace 61.8 percent of wave (i), with a target near Rs 955. Below this, prices could move to Rs 930. In summary, the trend remains bearish for Container Corporation; use pullbacks as a selling opportunity with a target of Rs 930 or lower, as long as Rs 1,000 holds on the upside.
Strategy: Sell
Target: Rs 955, Rs 930
Stop-Loss: Rs 1,000
Pravesh Gour, Senior Technical Analyst at Swastika Investmart
Cera Sanitaryware | CMP: Rs 9,436.7
On the longer horizon, Cera Sanitaryware has broken out of a triangle formation with significant volume. The stock's structure is strong, as it is trading above all significant moving averages. The momentum indicator RSI (Relative Strength Index) is positively poised, while MACD is witnessing a centerline crossover on the upside. On the higher side, Rs 9,800 is an important psychological level; above this, the stock could reach Rs 10,600+ in the near-short term. On the lower side, Rs 8,600 will act as major support during any correction.
Strategy: Buy
Target: Rs 10,600
Stop-Loss: Rs 8,600
Lux Industries | CMP: Rs 2,268
Lux Industries has recently broken out of a prolonged consolidation above the crucial Rs 2,000 level, accompanied by robust trading volume. This bullish momentum is reinforced by the stock trading above all key moving averages. The MACD indicator signals continued strength, while the RSI also points to positive price movement. Resistance is expected at the Rs 2,500 level. A breach above this could propel the stock towards the Rs 2,600+ zone in the near to medium term. However, Rs 1,980 is a crucial support to watch in case of any price correction.
Strategy: Buy
Target: Rs 2,650
Stop-Loss: Rs 1,980
Dr Lal PathLabs | CMP: Rs 3160
Dr Lal PathLabs is displaying strong short-term bullish momentum, characterized by higher highs and higher lows. A bullish breakout from a Flag pattern on heavy volume further strengthens the uptrend. The stock's position above crucial moving averages indicates a healthy technical structure. Positive momentum is confirmed by the RSI, while the MACD is generating a buy signal. Immediate resistance is at the psychologically important Rs 3,200 level. A breach above this level could propel the stock towards the Rs 3,400+ zone in the near term. However, Rs 3,000 is a critical support level to watch in case of a price pullback.
Strategy: Buy
Target: Rs 3,400
Stop-Loss: Rs 3,000
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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