Nifty for the past couple of weeks had been hovering around the 20-week SMA. This week the Nifty gained momentum and managed to move above the 15100 mark.
This strength seems to be broad based as the midcap and the smallcap too witnessed a bullish momentum.
On the option open interest front (May 27, 2021 expiry), open interest addition is seen in the 15300 calls. On the Put side, participation is seen in the 15000 Put contracts. Thus, going ahead, we can expect the broader range of the Nifty to be between 15000-15300 levels.
On the indicator front, the RSI plotted on the weekly time frame can be seen placed above the 50 mark and moving higher, indicating that the bulls have taken control of the trend.
Going ahead, 15140 will act as a key resistance level. If the prices break above the 15140 marks, we might see the index move higher towards the 15292-15300 (resistance cluster level).
On the downside, 14880 (multiple touch point) is the level to watch out. If the index manages to move below this level, we might see it move lower towards the 14600 (multiple touch point) mark.
To sum it all up, the index seems to be breaking out of a range. The key level to watch for on the upside is 15140. If the prices manage to sustain above this level, we can expect Nifty to move higher and test the 15300 mark.
Our bullish view will be negated on a move below 14880 mark, beyond which, we might see the prices head lower and test 14600.
Here is a list of three stocks to buy with short-term perspective:
Tata Coffee: Buy | Target: Rs 220 | Stop Loss: Rs 164 | Return: 23 percent
Tata Coffee for the past couple of weeks has been forming a higher high higher low pattern.
On May 19, the prices not only witnessed a breakout but also closed above the Rs 173.40 (January 2018 high). This up move was backed by above average volume indicating participation.
On the indicator front the RSI plotted on the daily and weekly time frame is placed above the 50 mark and moving higher, indicating the presence of momentum in the bullish trend.
Going ahead the Rs 183 (lifetime high) will act as a key resistance level. If prices manage to break above this level, we might see them move higher and test the Rs 220 (127% extrapolated level of the fall from Rs 183.50-48) and eventually towards the Rs 267 (161.8% extrapolated level of the fall from Rs 183.50-48).
The key level to watch for on the downside are Rs 164 followed by Rs 137.
Currently, the stock seems to be witnessing a surge in momentum, the technical parameters mentioned above point towards the Rs 220 and eventually towards Rs 267 with a strict stoploss of 164.
Shakti Pumps: Buy | Target: Rs 694 | Return: 22 percent
Shakti Pumps for the past couple of weeks has been moving higher after a correction.
In the last session, the stock gained momentum and managed to break above the previous week's high. This move was backed by above average volume, indicating participation in the up move.
On the indicator front, the RSI plotted on the daily and the weekly charts is placed above the 50 mark and moving higher, indicating the presence of bullish momentum in the trend.
Going ahead the Rs 694 (61.8% extension level of the rise from Rs 210-593 projected from Rs 457.50) will act as a make-or-break level. If the prices sustain above this level, we can see them move higher and test the Rs 758 (78.6% extension level of the rise from Rs 210-593 projected from Rs 457.50) and eventually towards the Rs 841 (100% extension level of the rise from Rs 210-593 projected from Rs 457.50).
The key level to watch for on the downside are Rs 590 followed by Rs 481 (recent swing low).
The technical parameters mentioned above point towards the possibility of the prices moving towards Rs 694 and eventually towards 758.
SPARC: Buy | Target: Rs 272 | Return: 29 percent
SPARC has been forming a rounding bottom since December 2018.
In the previous week, the stock broke above the 2-year consolidation and managed to sustain above the Rs 210 mark. This break out was backed by above average volume indicating participation as the prices move higher.
On the indicator frontm the RSI plotted on the daily and weekly time frame is placed above the 50 mark and moving higher, indicating the presence of momentum in the bullish trend.
Going ahead the Rs 272 will act as a make or break level. If the prices sustains above this level, we can see them move higher and test the Rs 292 followed by Rs 342.
The key level to watch for on the downside are Rs 202followed by Rs 161.
The technical parameters mentioned above point towards the possibility of the prices moving towards Rs 272 and eventually towards 292.
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.
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