Abhishek Mondal
Indian equity benchmarks Nifty50 and Sensex managed to close in green for two consecutive trading sessions on the back of rally led by banking stocks, ignoring weak global cues.
The market took positive cues from the banking sector after the Reserve Bank of India (RBI) allowed banks to spread out the bond losses over the next four quarters.
After a gap down opening, markets remained mildly volatile for most of the day; however, last hour buying helped the Nifty to close with gains above its 20-EMA (10,240 marks); forming a bullish Candle pattern on the daily scale.
If Nifty50 manages to hold and sustain above 10,250-mark in the next few trading sessions, it can move higher till the resistance of 10,450 – 10,500 levels (50DMA – 10,507). The immediate support is seen around 10,186 (200DMA) and 10,100 levels.
The Relative Strength Index – RSI on the Daily Chart is at 48.07 which is in a neutral zone with no divergence against the price. The MACD is trading with positive crossover but remains below the zero line, which indicates that the bias could remain neutral to bullish for the next few trading sessions.
On the Options front, maximum Call open interest of 34.91 lakh contracts is seen at strike price 11,000, followed by 10,500, which now holds 33.05 lakh contracts and maximum Put open interest of 44.76 lakh contracts is seen at strike price 10,000, followed by 9800 which now holds 31.18 lakh contracts.
As per the option data, in Nifty immediate support is seen around 10,000 levels whereas 10,500 will act as a hurdle in April expiry.
The India VIX ends down by 1.06 percent at 15.18 and is still trading above the crucial mark of 14 which indicates mild (intraday) volatility to remain in coming trading sessions as we are getting closer to Q4 earnings cycle.
Here is a list of top five stocks which could give up to 14% return in short term:
InterGlobe Aviation Ltd: BUY | Close: Rs 1367.85 | Target: Rs 1500 | Stop loss: Rs 1282 | Return: 9.65%
On the weekly scale, Indigo has taken support around its 50-DMA and bounced back with moderate volume, which suggests that the stock has made a temporary bottom around Rs 1190 levels.
The Weekly Relative strength index (RSI) showing upward momentum and the MACD is sustaining above the zero line with positive crossover whereas +DI continuously trading above -DI, which indicates the stock price has potential to move higher.
The positional traders can buy the stock in the range of Rs 1360-1370 with a stop loss below Rs 1282 (closing) for the target of Rs 1500.
Jamna Auto Industries Ltd: BUY | Close: Rs 85.85 | Target: Rs 98 | Stop loss: Rs 78.50 | Return: 14.15%
The stock has given a consolidation breakout above Rs 80 level on the daily scale with higher volumes. The Daily Relative Strength Index (RSI) is showing an upward trend and the MACD is trading with a positive crossover above the zero line, which indicates that the stock has potential to move higher from current levels.
Positional traders can buy the stock at current levels and add on dips around Rs 81-83 with a stop loss below Rs 78.50 (closing) for a target of Rs 98.
Exide Industries Ltd: BUY | Close: Rs 232.95 | Target: Rs 260 | Stop loss: Rs 215 | Return: 11.59%
The stock price has taken the support of the upward trend line and bounced back from the same on the weekly scale. The weekly Relative Strength Index (RSI) is showing upward momentum and the MACD is sustaining above the zero line with positive crossover.
Based on the above-mentioned observations traders can buy the stock in the range of Rs 228-233 with a stop loss below Rs 215 (closing) for the target of Rs 260.
Kaveri Seed Company Ltd: BUY | Close: 499.80 | Target: Rs 555 | Stop loss: Rs 470 | Return: 11.00%
The stock has given a breakout from symmetrical triangle pattern above Rs 487-489 levels on Monday with moderate volumes in the daily scale.
The Daily Relative strength index (RSI) is making the higher bottom and higher top and MACD is trading with a positive crossover near zero line whereas OBV — On Balance Volume, continuously trading in a positive channel.
Traders can buy the stock in the range of Rs 495-500 with a stop loss below Rs 470 (closing) for the target of Rs 555.
Colgate Palmolive (India) Ltd: Buy | Close: Rs 1085 | Target: Rs 1148 | Stop loss: Rs 1050 | Return: 5.81%
The stock has given rounding bottom pattern breakout above Rs 1070 level in the daily scale. The daily Relative Strength Index (RSI) is showing upward momentum and the MACD is trading with positive crossover whereas +DI just started the journey above –DI.
Based on the above observation, positional traders can buy the stock at current levels and add on dips around Rs 1070-1075 with a stop loss below Rs 1050 (closing) for a target of Rs 1148.
Disclaimer: The author is Research Analyst, Guiness Securities. 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.
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