Market is expected to remain marginally positive on account of steady inflow by foreign investors coupled with strong inflow from domestic investor through mutual fund on tax purpose.
The Indian equity market traded with upward trend on week-to-week basis to move above its psychological level on account of de-escalation of geopolitical tensions across border coupled with favourable global market regime backed by positive trade talks between US and China.
Further, retaining a fastest growing economy status with Q3FY19 GDP at 6.6 percent aided the market sentiment positively despite being a lower number.
During the past week, Nifty managed to sustain above both long-term moving average and also closed above its short-term 50-days moving average of 10,800 odd levels on closing basis. The index formed a weekly low of 10,784 level on intraday basis, but managed to rebound to make weekly high of 11,089 levels.
Despite a flat trade on daily scale to close at 11,058.20 levels, but index gained about 2.5 percent on week-to-week basis. The top gainer was Nifty PSU Banks and Metals, up by about 7.5 percent and 5.1 percent, respectively. The Nifty IT index was only loser down by about 2 percent on weekly basis.
The Nifty index formed a bullish candlestick pattern on weekly chart led by buying regime at lower level, but profit-booking at upper level on daily scale led to small bearish pattern.
However, momentum indicator signaled a positive divergence with its weekly RSI 56 odd levels, and MACD started to trade above its signal-line. The near term resistance for index is now seen at 11118 levels while support is placed at 10780 odd levels.
The Indian equity market is expected to remain marginally positive on account of steady inflow by foreign investors coupled with strong inflow from domestic investor through mutual fund on tax purpose. However, an overhang de-growth sentiment on global front coupled with election event are likely to keep index volatile given a lack of major trigger in market.
Therefore, we continue to stick with quality names on long-position with trailing stop-loss, and liquidate a position on weakness. We maintain a weekly rangebound level at swing high of 11118 levels on upside and 10780 levels on downside.
Here are the top stock trading ideas which can give good returns in the near term:
ITC: Buy | Target: Rs 305 | Stop loss: Rs 275 | Upside: 5%
ITC witnessed a strong breakout during recent session to trade above its 200-day moving average placed at Rs 279 odd levels after remaining flat momentum over a two-month, and further the scrip remained strong on weekly scale.
The scrip largely traded in sideways direction with negative bias on its six-month price chart to consolidate from price-band of Rs 310-290 odd levels towards a low of Rs 265 zone which also stood as strong support level. The scrip also witnessed a decent volume growth to remain in positive trajectory, and formed a long bullish candlestick pattern on weekly price chart coupled with bullish candlestick chart on daily scale led by buying regime.
The momentum indicator outlined a positive divergence in price with RSI at 66 odd levels, and MACD making bullish crossover to trade above its Signal-Line.
We have a buy recommendation for ITC which is currently trading at Rs 290.10.
Larsen & Toubro: Buy | Target: Rs 1,407 | Stop loss: Rs 1,315 | Upside: 4%
L&T saw a reasonable breakout on weekly price-chart managing to close above its 200-days moving average placed at Rs 1315 odd levels, and continued to maintain a positive trajectory on daily scale for an extended period to outperform its market headlines.
The scrip initially consolidated from a price-band of Rs 1460 odd levels towards a low of Rs 1230 levels which stood as strong support level, and post this correction it witnessed a strong rebound. It formed a long bullish candlestick pattern on weekly price chart for a consecutive week coupled with bullish pattern on daily scale backed by volume surge.
The momentum indicator outlined a positive divergence in price with RSI at 66 odd levels, and MACD witnessing a fresh bullish crossover to trade above its Signal-Line.
We have a buy recommendation for L&T which is currently trading at Rs 1352.40
Mphasis: Sell | Target: Rs 965 | Stop loss: Rs 1028| Downside: 3%
Mphasis continued to trade in negative trajectory for a five consecutive session to fall from higher price band of Rs 1060 levels towards a low of Rs 970 odd levels, and thus breaching below its important support level of 200-days moving average placed at Rs 991 odd levels this week.
Further, the scrip is still in consolidation phase on its six-month chart falling from Rs 1265 odd levels towards a low of Rs 870 levels, and it currently trades below all the moving average levels. The scrip formed a solid bearish candlestick pattern on weekly which indicates a persistent selling pressure coupled with bearish pattern on daily scale.
The momentum indicator continued to outline weak trend with weekly RSI at 47 odd levels while MACD is likely to trade below its Signal-Line in coming sessions.
We have a sell recommendation for Mphasis which is currently trading at Rs 996.60
(The author is Founder & CEO, 5nance.com.)Disclaimer: The views and investment tips expressed by investment expert on moneycontrol.com are his own and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.