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Last Updated : Nov 01, 2019 01:19 PM IST | Source: Moneycontrol.com

Hot Stocks: Hold longs on Nifty with a stop-loss below 11,600 levels

On the Nifty, 11,980-12,000 could initially act as intermediate hurdle above which it could test 12,200 levels

 
 
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Mehul Kothari

The Nifty cleared the important resistance mark of 11,800 on October 31 and the possibility of new highs cannot be ruled out in coming sessions.

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On the Nifty, 11,980-12,000 could initially act as intermediate hurdle above which it could test 12,200 levels.

The support on the downside has shifted to 11,600 from 11,500.

We would advise traders to hold their long Nifty positions but with a strict stop loss of 11,600. A move below the same might halt the upside momentum and we could witness some profit booking.

With regards to Nifty Bank index, there is something to worry about. On the daily chart, the index is stuck below the placement of the falling trend line formed by joining the important swings of 31,660 and 30,801.

In order to rise further, the Nifty Bank will have to surpass the 30,400 mark. In case it fails to do so, then there could be some profit booking in banking stocks which might put pressure on the Nifty as well.

Here is a list of top three stocks that could return 12-13 percent in the next one-to-two months:

Apollo Tyre: Buy| LTP: Rs.190| Target: Rs 214 |Stop Loss: Rs.178 | Upside 12.63%

On the weekly chart of Apollo Tyre, we have witnessed a breakout from the falling trend line along with a confirmation of higher top and higher bottom.

The 5-weeks and 20-weeks exponential moving averages are on the verge of confirming a bullish crossover.

In addition, we are observing a range breakout in the weekly RSI just above the 50 mark which indicates strength.

Traders are advised to buy the stock near Rs 190 for an upside target of Rs 214, and a stop-loss of Rs 178. (1 – 2 months)

Ceat: Buy| LTP: Rs.1008| Target: Rs 1140 |Stop Loss: Rs.930 | Upside 13%

Similar to Apollo Tyres, even Ceat Ltd has a trend line breakout on the weekly chart along with a confirmation of higher top and higher bottom.

The 5-weeks and 20-weeks exponential moving averages (EMA) are on the verge of confirming a bullish crossover.

In addition, we are observing a range breakout in weekly RSI just above the 50 mark which indicates strength.

Traders are advised to buy the stock near 1000 for an upside target of Rs 1140 with a stop-loss of Rs 930. (1 – 2 months)

V-Guard: Buy| LTP: Rs.250| Target: Rs 284 |Stop Loss: Rs.234 | Upside 13%

During the month of May 2019, V-Guard confirmed a ‘Symmetrical Triangle’ pattern breakout above 225 mark which had a target price of over Rs 300.

Post that the stocks have been consolidating between 250 – 220.

Recently, the stock confirmed a breakout from this range and made a new life high. Even the placement of weekly RSI indicates a sharp upside post this breakout.

Traders are advised to buy the stock at Rs 250 for the upside target of Rs284, and a stop-loss can be placed at Rs 234. (1–2 months).

(The author is Sr. Technical Analyst, IndiaNivesh Securities Limited)

Disclaimer: The views and investment tips expressed by investment experts 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.
First Published on Nov 1, 2019 08:16 am
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