It was volatile for the Indian stock markets last week, but the bulls managed to push the index back above 15,800 at Friday’s close. The Nifty 50 ended the week with a loss of 0.4 percent while the S&P BSE Sensex fell 0.3 percent.
The Nifty 50 had closed above 15,900 (at 15,923.40) on July 16, but it failed to hold on to the momentum amid weak global cues. For more than a month now, the Nifty 50 has been trapped in a range of about 500 points.
For the most part of June, the index was confined to domestic triggers, but global factors started to influence the markets in July. For the bulls to take control, the Nifty 50 has to close above or surpass 16,000 convincingly. On the downside, support is placed at 15,500-15,450 levels, experts suggested.
“Unfortunately, global peers experienced some selloff when the Nifty was about to reach the milestone of 16,000 last week. After undergoing some price correction for the first couple of days, we witnessed a good relief rally to reclaim the important level of 15,800 on a weekly closing basis,” said Sameet Chavan, chief analyst - technical & derivatives, at Angel Broking.
“This certainly bodes well for the bulls, but considering the recent trend, we are still not out of the woods. So, rather than pre-empting and getting caught on the wrong foot, we would wait for Nifty to surpass the sturdy wall of 16,000. If this happens, then the next immediate levels to watch out for would be 16,200-16,400.”
Chavan added that while the index is not too far from 16,000, there could be good stock-specific action.
“We reiterate: if Nifty has to reach and surpass the magical figure of 16,000, banking certainly plays a vital role here,” Chavan said.
Here’s a list of top 10 trading ideas from experts for the next 3-4 weeks:
Sacchitanand Uttekar, DVP – Technical (Equity), Tradebulls Securities
The price is trending close to its lifetime high. On the monthly scale, the stock has completed its ‘rounding bottom’ formation while on the weekly scale, it has witnessed a fresh breakout from a continuation pattern/bullish flag formation.
Its ongoing secular upward move is expected to remain intact with immediate pattern price targets coinciding at about the Rs 1,140 zone.
A bullish Harami formation was seen on its weekly scale followed by a spike formation that awaits a confirmatory close. Once Rs 2,140 is breached on the upside, it would mark the termination of its ongoing consolidation/corrective formation.
As of now, the stock is still oscillating within its declining wedge formation on its daily scale, with its daily relative strength index (RSI) trending above the 50 mark.
So far, it has held on to its 5 and 20 WEMA support zone well. Hence, we believe once it breaks above Rs 2,140, the stock could revisit its 52-week high in no time.
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The stock saw a breakout from the cup & handle formation on the weekly scale, with the price closing above its 200 DEMA consecutively for the first time since its listing on December 23, 2020 – positive for the bulls.
The weekly ADX reading is above 30 now, which serves as an added confirmation for the pattern breakout. We expect momentum to sustain as long as Rs 420 holds.
Positive sector outlook, along with bullish pennant formation on its daily scale, looks mature. A breakout above Rs 2,200 should see a strong unidirectional momentum towards its pattern target placed around Rs 2,480.Expert: Ashish Chaturmohta, Director Research, Sanctum Wealth Management
Infosys, in its most recent quarter, estimated revenue growth at 14-16 percent compared with 12-14 percent earlier. The margin guidance has been retained at 22-24 percent because of wage increases in the second quarter of FY22 and certain post-COVID-19 costs from the third quarter.
Infosys is at fair value at current levels. Technically, the stock is in an uptrend, forming higher highs and higher lows. For the past four weeks, it has been consolidating at all-time high levels.
Now, Infosys is showing signs of a breakout that has led to the resumption of the uptrend. The stock can be bought at current levels with a stop-loss of Rs 1,540 and a target of Rs 1,800.
Tata Steel is getting traction because Chinese companies are reducing their production to comply with government norms followed by higher domestic/export realisation for India operations and a sustained focus on deleveraging.
Price-wise, the stock is in a major uptrend. Over the past couple of months, the stock has formed a short base and broken out. The stock can be bought at current levels with a stop-loss of Rs 1,225 and a target of Rs 1,450.
Jubilant Ingrevia, which demerged from Jubilant Life Sciences, forecast Rs 950 crore in capital expenditure across all segments in the next three. [Net block – Rs 1,800 crore (FY21)]*
The capex is targeted towards key growth areas such as Diketene derivatives, contract development and manufacturing, agricultural ingredients and nutrition pre-mix plant, which should enhance the company’s overall margin profile.
On this count, the company estimated EBITDA margins would increase to ~20 percent over the medium term from ~17 percent in the fourth quarter of FY21. Technically, the stock is on an uptrend, making higher highs and higher lows on the daily chart since listing.
After six weeks of consolidation, the stock broken out with huge volumes, indicating buying participation. The stock can be bought at current levels with a stop-loss of Rs 595 and a target of Rs 725.
For the past five months, the ICICI Bank stock has been trading sideways to a negative correction after the sharp run it had seen.
Now, the stock is trading at breakout levels and is showing signs of resuming an uptrend. The stock can be bought at current levels with a stop-loss of Rs 640 and a target of Rs 775.
The company is currently developing projects that are estimated to cover more than 89.7 million square feet. Godrej is targeting sales of Rs 100 billion in FY23 (from Rs 65 billion in FY21).
Currently, it is a unique opportunity for consolidation – there is stress on the supply side (developers), but at the same time, the demand environment has improved.
Further, it has an aggressive land acquisition strategy wherein it plans to fully deploy Rs 37 billion raised in equity funds in the fourth quarter towards new project acquisitions over FY22-23.For the past seven months, the stock price has been consolidating its gains between Rs 1,570 and about Rs 1,200. Sustaining above Rs 1,570, the uptrend is expected to continue. The stock can be bought at current levels with a stop-loss of Rs 1,490 and a target of Rs 1,800.
Expert: Gaurav Garg, Head of Research, CapitalVia Global Research Limited
The stock has witnessed a reversal from its support level in the zone of Rs 525-530. The stock might gain further strength if it manages to sustain above Rs 560.
The crossover of its short and medium-term averages on the daily charts with strong volumes show signs of a further upside.
The RSI has also turned positive on the daily charts, indicating limited weakness in the stock.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.