By Rohit Singre Bonanza Portfolio
The Nifty closed with a small loss of 23 points on Wednesday session and formed a Doji candle pattern. The index is hovering near the breakout levels (10,180) in the last two sessions, holding same may take Nifty towards 10,130.
If we look at broader chart index has given double bottom pattern breakout recently from 9,700 levels with decent volume. According to the pattern, Nifty targets come near 10,640 and we expect to hold above 10,130 levels expected target can be achieved in the near-term.
On the derivatives front, highest open interest seen in 10,000 PE followed by 9900 PE which will act as strong support in this expiry whereas on higher side 10200 CE & 10300 CE has highest open interest.
One can expect more short covering once index will move above 10,250 levels. For the near term, we expect its buy on dip markets and one can use any dip as a buying opportunity.
For traders we recommend, the current position can be held for the target of 10,300 with the stop of 10,170 and fresh shorts can be initiated below 10,170 for the targets 10,130.
Here is a list of five stocks which can give up to 19% return in short term:
NCC: BUY | Target Rs 103| Stop Loss Rs 87| Upside 9%
The stock is in a consolidation mood since five months, in which we have witnessed many volume breakouts but stock not reacted technically.
If we look at current chart structure stock has broken its Bullish Flag pattern on the daily chart with strong volume hinting stock has got the momentum and we may expect it to move northwards.
On the weekly chart, the stock is trading in rising channel pattern and the stock is bouncing from lower band of the channel with increasing volume which suggests stock has potential to touch its upper band in near term.
Considering above technical setups bonanza recommends a buy call on stock at current levels to any dip near Rs92 for the target of Rs103 with keeping stop out level below Rs87 on closing basis.
ONGC: BUY | Target Rs 191| Stop Loss Rs 164| Upside 9.50%
The stock corrected from 210 to 155 since the start of this year and if we look at current chart structure stock seems to be attractive at these levels.
After straight fall, stock consolidated for four months to form the base and we have seen a good pullback in stock from lower levels. If we look at weekly chart stock has taken support at 100 DMA and started rising up with decent volume.
Momentum indicator RSI currently reading at 62 which is considered as a bullish zone. Considering above technical setup Traders can accumulate the stock at current levels to any dip near 167 for the target of Rs 191 with a stop loss below Rs 164 on a closing basis.
VST Industries: BUY | Target Rs 3700 | Stop Loss Rs 2800| Upside 19%
The stock corrected from 3800 to 2600 in last three months and took pause near its 50% retracement support from the previous low of 1400.
The stock started giving small consolidation breakouts on the daily chart with decent volume that suggests stock will continue its overall uptrend. On the daily chart, the stock managed to trade above 100-200 DMA which is considered to be strong support as now for stock.
On the higher side, an immediate hurdle for the stock is 3200, sustain above the same we may expect the stock to move towards 3700 in near term.
Traders can take a position in the counter at current levels to any dip near 2975 for the targets of 3200 and 3700 with keeping stop out levels below 2800 on a closing basis.
Nilkamal: BUY | Target Rs 1900 | Stop Loss Rs 1570| Upside 15%
The stock has given strong consolidation breakout on Wednesday session with the highest volume suggesting the near-term bottom is formed.
On the weekly chart, the stock took pause at its 100 DMA and after consolidating for 10 weeks it has given a strong volume breakout hinting upside in near term.
On daily chart, the stock has immediate hurdle at 1800 which is 200 DMA so we may expect some profit booking at this levels but any strong breakout above the same will take stock to 1900 levels.
Traders can take a position in the counter at current levels to any dip near 1650 for the targets of 1800-1900 and stop out levels can be kept below 1570 on a closing basis.
L&T Technology: BUY | Target Rs 870 | Stop Loss Rs 750| Upside 10%
The stock is not performed historically & we have seen continually lower lows on the counter, but now stock chart showing potential at current levels.
On the daily chart, the stock has broken its long-term downtrend line with decent volume along with it stock has given double bottom breakout also which suggest some trend reversal is going to happen.
We can see positive divergence also in RSI and stock is trading above all strong DMA’s like 200-100 etc. Traders can take a position in the counter at current levels to any dip near 770 for the targets of 870 and stop out levels can be kept below 750 on a closing basis.
Disclaimer: The author is Senior Research Analyst, Bonanza Portfolio Ltd. 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.
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