Indian markets remained volatile throughout last week and failed to record a breakout above 10,930-10,950 despite multiple events. The index closed the week with losses of little over 1 percent for the week ended January 25.
Friday’s session turned out to be a nightmare as Nifty slipped below its crucial support at 10,800 and below most of its short and long-term moving averages. The index is likely to remain volatile ahead of January F&O expiry, Interim Budget as well as December quarter numbers from India Inc.
The index witnessed a bearish candle on weekly charts and going forward it would be difficult for the index to surpass 11,000 convincingly in a hurry. Technically speaking, we are still hovering around the pullback zone of ‘Falling Trend Line’ but the way some of the stocks corrected certainly does not bode well for the bulls.
“As far as levels are concerned, 10,750 followed by 10,692 would be seen as a crucial support zone. A sustainable move below this would result into a sharp correction to test sub-10,600 levels in days to come,” Sameet Chavan, Chief Analyst - Technical & Derivatives at Angel Broking Ltd told Moneycontrol.
“On the flipside, January 25 high of 10,931 has now become a key hurdle for the bulls. If the index has to regain any strength ahead of the Union Budget, this level needs to be surpassed convincingly to unfold the next leg of the rally. Till then it’s advisable to stay light and avoid taking undue risks,” he said.
Here is a list of top 10 short term trading ideas by experts that could give 4-9 percent return in February series:
Analyst: Sameet Chavan, Chief Analyst - Technical & Derivatives at Angel Broking Ltd
Godfrey Phillips: Buy| LTP: Rs 945| Target: Rs 1,020| Stop loss: Rs 914| Return: 8 percent
Last three months have been fantastic for this high beta counter. The daily chart depicts a series of ‘higher highs and higher lows’ and in the process, the stock process finally broke out from the trendline hurdle of Rs 930 with some authority.
Importantly, this move was supported by humongous volumes, providing credence to the price action. Post this, the stock prices saw some consolidation but we would construe this as a good buying opportunity.
We recommend going long for a positional target of Rs 1,020 in coming days. The stop loss can be placed at Rs 914.
Britannia Industries: Buy| LTP: Rs 3,206| Target: Rs 3,460| Stop loss: Rs 3,060| Upside: 8 percent
This FMCG giant has been a steady performer for last many years. Of late, we witnessed a consolidation in this counter that can be termed as a ‘Price correction’ and was overdue for a long time.
Last week, we saw some buying interest coming back into the stock and in the process, it managed to surpass the ‘Falling Trendline’ placed around Rs 3,180.
This is a sign of strength and going ahead, we expect the stock to resume its long-term uptrend soon. Hence, one can look to go long for a target of Rs 3,460 in coming days. The stop loss can be placed at Rs 3,060.
Kaveri Seed Company: Buy| LTP: Rs 590.35| Target: Rs 642| Stop loss: Rs 564| Upside: 8.8 percent
The stock has been consolidating of late and has been struggling to surpass its ‘Falling TrendLine’ resistance around Rs 580. On Friday, despite broader market remaining under severe pressure, this stock managed to buck the trend and in the process, went on to cross this hurdle; thereby confirming a breakout from the bullish cup and handle pattern on the daily chart.
In addition, more than twice of average daily volume on the same day provide credence to the move. Hence, we recommend going long for a target of Rs 642 in coming days. The stop loss can be placed at Rs 564.
Analyst: Dinesh Rohira, Founder & CEO, 5nance.com
Wipro: Buy | Target: Rs 371 | Stop loss: Rs 330 | Upside: 5 percent
Wipro maintained an upward trajectory for the last one week despite a volatile market breadth and managed to swiftly move upward from its resistance zone of 50-day moving average placed at Rs 330 on closing basis.
The stock also managed to break out from its 200-day moving average placed around Rs 310 in the past session that forms a strong support base for the scrip.
Initially, the scrip remained sideways and was consolidating in a price range of Rs 340-307. The scrip formed a bullish candlestick pattern on both weekly and daily price charts.
The momentum indicator outlined a positive divergence in price with its RSI at 63, coupled with MACD managing to make a bullish crossover in the same period to trade above its signal line. We have a buy recommendation for Wipro, which is currently trading at Rs 353.45.
Graphite India: Sell | Target: Rs 530 | Stop loss: Rs 577 | Downside: 4 percent
Graphite India continued to trade in a negative trajectory for an extended period to fall below its crucial support of Rs 670 in the previous session while it also breached its 200-day moving average on the downside placed at Rs 818.
The scrip continued to consolidate from a higher level of Rs 1,120-1,050 towards a low of Rs 770 and made a strong rebound towards 1,000 that failed later.
The scrip made a 52-week low of Rs 555 in the last trade that indicates sustain selling pressure. It formed a long bearish candlestick pattern on both daily and weekly price charts.
Further, weekly RSI stood at 29 indicating persistent selling regime, and MACD continued to trade above its signal line. We have a sell recommendation for Graphite India, which is currently trading at Rs 552.95.
Analyst: Sumeet Bagadia, Executive Director, Choice Broking
TCS: Buy| LTP: Rs 1,919| Target: Rs 2,050| Stop loss: Rs 1,860| Return: 7 percent
At present level, IT sectors look attractive, and if we go for any particular stock then TCS looks good as it has given a breakout of its upper band of triangle formation that indicates an upside movement in the counter.
Moreover, the stock has started to trade above its 50-day moving average that is placed at Rs 1,915, which shows a positive trend for the time being.
A daily momentum indicator, RSI, reading is at 54.45 with a positive crossover. Apart from this, the RSI has given a breakout of its downward sloping trendline that points out for a positive breath in the stock. So one could go and buy TCS in cash at Rs 1,929 with a stop loss below Rs 1,860 with a target of Rs 2,030-2,050.
Havells India: Buy| LTP: Rs 708| Target: Rs 765| Stop loss: Rs 680| Return: 8 percent
On the daily chart, the stock is on the verge to give a breakout of its neckline of cup and handle formation, which is a continuation formation and indicates a robust upside movement in the counter.
Moreover, the stock has been trading with the strong support of 21 and 50-day moving average that suggest a positive trend in the stock.
RSI reading is at 54.45 with a positive crossover. Apart from this, the RSI has given a breakout of its downward sloping trendline that points to positive breath in the stock. One could get into the stock at Rs 708 with a stop loss of Rs 680 and a target of Rs 765.
InterGlobe Aviation: Buy| LTP: Rs 1,163| Target: Rs 1,250| Stop loss: Rs 1,110| Return: 7 percent
On the daily chart, the stock has given a breakout of its neckline of the inverse head and shoulder pattern with above-average volume that indicates an upside movement in the counter.
Moreover, the stock has been sustaining above its 200-day moving average that shows strength in the counter.
RSI reading is at 58.75 with a positive crossover that points to positive breath in the counter. One could go for buy at Rs 1,161.75 and upwards towards Rs 1,150 with a stop loss at Rs 1,110 and a target of Rs 1,240-1,250.
Brokerage: SMC Global Securities Ltd
Petronet LNG: Buy| LTP: Rs 227| Target: Rs 240-245| Stop loss: Rs 210| Upside: 8 percent
200-day Exponential Moving Average (DEMA) of the stock on the daily chart is currently at Rs 222.74. The stock consolidated in a stiff range and formed an inverted head and shoulder pattern on weekly charts, which is considered to be bullish.
Moreover, it is likely to close on verge of the breakout of same along with huge volumes. Apart from this, it also manages to trade above 100-WEMA, which also gives a positive outlook for coming days, so one can initiate long in the range of Rs 220-222 for the upside target of Rs 240-245 with stop loss below Rs 210.
Tech Mahindra: Buy| LTP: 728| Target: Rs 790| Stop loss: Rs 670| Upside: 8 percent
The stock made a 52-week low at Rs 563.65 on February 19, 2018 and a 52-week high of Rs 780.80 on October 3, 2018.
The 200-day Exponential Moving Average (DEMA) of the stock on the daily chart is currently at Rs 676.85. Short, medium and long-term bias are positive for the stock as it is continuously trading above 200-DEMA.
From past few weeks, it was consolidated in the range of Rs 640 to 770 with positive bias and formed a continuation triangle on weekly charts, which is bullish in nature.
Last week, the stock gained over 2.5 percent, gave a breakout of pattern and also managed to close above the same. So, follow up buying is expected to continue in the coming days. Therefore, one can buy in the range of Rs 710-715 for the upside target of Rs 770-790 with a stop loss below Rs 670.
Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their 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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