Rupak De Bonanza Portfolio
Nifty50 on the daily chart has given a rising channel breakdown which suggests bearish reversal of the short-term trend. However, even after a breakdown, the price is showing no hurry to fall further which may be termed as exhaustion of weakness.
Also, formation of Doji pattern after a corrective leg often suggests a pause in the trending movement. In addition, the 38.20 percent retracement (currently pegged at 10,615) of the previous rise from 10,004 to 10,987, co-insides with the recent low.
On the options front, maximum open interest (Feb series) position is visible in 11,000 CE (21.78Lakh shares) and 10,700 PE (21.52Lakh shares); followed by 11,200 CE (12.50Lakh shares) and 10,400 PE (20.94Lakh shares).
Going forward, 10,600 is expected to act as crucial support for Nifty, and any fall towards 10,600 may get bought into. On the higher end, 10,800 is expected to act as initial resistance.
Sustained trades above 10,800 may induce a rally towards 11,000 levels in February series. On the other hand, a breakdown below 10,600 may trigger medium-term bearishness in the market.
Here is a list of top three stocks which could give 7-9% return in the next 1 month:
Cyient: Buy| CMP: Rs 612.35 | Target: Rs 661| Stop Loss: Rs 593| Return 8%
The stock has moved above falling in a consolidation pattern on the daily chart which suggests bullish reversal of the previous trend.
In addition, a positive divergence is visible on the daily chart of the stock. Moreover, RSI (14) is in bullish crossover and rising. Traders can accumulate the stock in the range of 610-615 for the target of 661 with a stop loss below 593.
SBI: Buy| CMP: Rs.287.45 | Target Rs 308| Stop Loss: Rs.278| Return 7%
The stock formed a Doji candle on the daily chart which was followed by a large green candle which suggests a falling trend has ended and the stock price is ready to move up in the short-term.
The momentum indicator, RSI (14) has reversed from the oversold zone and has entered in a bullish crossover. Traders can accumulate the stock in the range of 285-290 for the target of 308 and a stop loss below 278.
NMDC: Buy| CMP: Rs.96.10 | Target: Rs 105| Stop Loss: Rs.92| Return 9%
On the daily chart, the price has moved above its previous swing high which indicates a rise in optimism. The daily MACD is in bullish crossover and is rising.
The weekly RSI (14) has made a double bottom and has moved up which suggests improving positive momentum in the stock price. Traders can accumulate the stock in the range of 95-97 for the target of 105 with a stop loss below 92.
The author is a Technical Research Analyst at Bonanza Portfolio Ltd.
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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