Podcast | Stock picks of the day: A close below 11,100 could take Nifty towards 10,900
Nifty can witness a pullback towards 11,400. Going forward a sustained trade above 11,400 may induce further rally towards 11,570.
Rupak De
The Nifty has been consolidating after a sharp fall from the recent high of 11,789. During the day, the Nifty has erased all the gain it made on Tuesday.
However, the bearish trend has already started to weaken, at least for the very short term. In addition, the index is seen to have found initial support at a historical swing high on the daily chart.
On a Heiken Ashi plotting, the chart has been consolidating on the daily frame. All these indicate a short term pullback.
On the higher end, the Nifty can witness a pullback towards 11,400. Going forward, a sustained trade above 11,400 may induce a further rally towards 11,570.
On the flip side, the market may resume its southwards journey on a breakdown below 11,100. A close below 11,100 could take the index towards 10,900-10,700 levels.
Here is a list of top three stocks which could give 7-8 percent return in the short term:
Ujjivan Financial Services: Buy| CMP: Rs.317.30| Target: Rs 344|Stop Loss: Rs 307|Upside 8 percent
The stock recorded a falling wedge breakout on the daily chart, which suggests a reversal of the previous weak trend. In addition, the stock is seen to have found support above the historical peak on the daily chart.
The daily RSI (14) has entered in a bullish crossover. Traders can accumulate the stock in the range of Rs 315-320 for the target of Rs 344 and a stop loss below Rs 307.
Axis Bank: Sell| CMP: Rs.721.95| Target: Rs 670|Stop Loss: Rs.741|Upside 7 percent
The stock on the daily chart has fallen below a rising channel pattern, which suggests the end of the previous uptrend and start of a downtrend.
The weekly Heiken Ashi has started to reverse, which suggests a reversal of the bull trend. The momentum oscillators like RSI (14) and MACD are in the bearish crossover.
Traders can sell the stock in the range of Rs 717-725 for the target of Rs 670, and a stop loss above Rs 741.
HDFC: Sell| CMP: Rs 1944.95| Target: Rs 1,847|Stop Loss: Rs 1,993|Upside 7 percent
On the daily chart, the stock has been moving with a lower-top lower-bottom formation, which is a bearish setup. In addition, the price has reversed from the 61.8 percent retracement level of the previous fall on the daily chart from Rs 2,037 to Rs 1,901.
The momentum oscillators like RSI (14) and MACD are in the bearish crossover. Traders can sell the stock in the range of Rs 1,940 -1,950 for the target of Rs 1,847 and a stop loss above Rs 1,993.
(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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