We expect the Nifty to remain range bound on a weekly basis, with the upside and downside capped at 10,790 and 10,570 levels, respectively.
The Indian equity market continued to trade sideways during the week gone by in the backdrop of May series expiry and several other domestic and global developments.
The Nifty marginally gained momentum after it breached the crucial level of 10,600 on the downside last week, but managed to touch a high of 10,764 on the weekly chart. Despite a positive momentum, it has failed to hold this level on Friday as it closed at 10,696, a gain of about 0.86 percent on a weekly basis.
After forming a bullish candlestick pattern on the Thursday’s price chart, the Nifty formed a bearish pattern on Friday, although no major formation was seen on a weekly basis. Its weekly relative strength index (RSI) stood at 58, indicating no price divergence, while moving average convergence divergence (MACD) indicated bullishness as it continued to trade above the ‘Signal Line’.
The market is likely to trade sideways ahead of the Monetary Policy Committee’s meet this week and take direction from the outcome. Any weak global sentiment is also likely to weigh on the market as witnessed in the past few sessions last week.
Hence, we advise investors to be stock-specific, applying a strict stop-loss on a trailing basis. We expect the Nifty to remain rangebound on a weekly basis, with the upside and downside capped at 10,790 and 10,570 levels, respectively.
Here is a list of top stocks that could deliver 4-12 percent returns in the short-term:
Bodal Chemical Ltd: Buy | Target: Rs 161 | Stop-loss: Rs 132 | Return 12%
Bodal Chemical witnessed a sharp correction in the last six-month from Rs 172 levels towards Rs 114-111 zone where it formed two consecutive bottom trend-channel which indicated a strong support.
Recently, it witnessed a strong upward momentum where it made two higher peaks after breaching its 20-days EMA level placed at Rs 135 levels.
Substantially, the scrip also witnessed a strong volume growth on the weekly basis and formed a bullish candlestick pattern on the weekly price chart with about 13 percent gain in same period despite closing lower on Friday.
The weekly RSI level up at 55 coupled with positive divergence on MACD which indicates a buying regime at the current level.
The scrip has a support placed at Rs 114 levels and resistance level at Rs 172. We have a buy recommendation for Bodal Chemicals which is currently trading at Rs. 143.60
KPIT Technologies Ltd: Buy | Target: Rs 303 | Stop-loss: Rs 273 | Return 6%
KPIT Technologies continued to trade on positive trajectory throughout the week despite a weak market breath and managed to breakout from crucial moving average level placed at 267.
Although the stock witnessed a minor correction to trade below Rs 247 levels but made a strong rebound to make the fresh higher peak. The scrip also witnessed a sharp volume buildup indicating a sustained trend.
The scrip formed a solid bullish candlestick pattern on its weekly price chart indicating upward momentum. Further, a secondary momentum indicator witnessed a revival with weekly RSI level continuing in buying zone coupled with a positive cue on MACD.
The support level for scrip is currently placed at 262 and resistance level at Rs 315. We have a Buy recommendation for KPIT Technologies which is currently trading at Rs 285.75
3-5 positional calls that could offer handsome returns to investors in the next 1 month?
A) Here is a list of top three stocks that could offer 6-7% returns in the next one month:
Torrent Pharma Ltd: CMP: Rs 1,438| Buying Range: Rs 1,430-1,400| Target: Rs 1540| Stop loss Rs 1375| Return 7%
On the weekly chart, the stock has observed a ‘Down Sloping Trendline’ breakout at Rs 1,420 on closing basis which signals a change of trend towards the upside.
This breakout is accompanied with high volumes indicating increased participation. The stock is currently trading above all its crucial SMA i.e. 20, 50, 100. The RSI and Stochastic are also in the positive terrain.
BPCL: CMP: Rs 408.55| Buying Range: Rs 408-400| Target: Rs 430-437| Stop loss: Rs 391| Return 7%
BPCL has given a downward sloping trendline breakout at Rs 400 which was also the immediate acting resistance in the stock and went on to make a high of Rs 411.50 on a closing basis.
The stock is witnessing high volume along with the support placed at 20 and 50-days SMA. The momentum indicators are also signaling a positive probability towards the bullish momentum in the stock.
Godrej Consumer Products: CMP: Rs 1,163.90| Buying Range: Rs 1,163-1,145| Target: Rs 1,230| Stop loss: Rs 1,115| Return 5.6%
Godrej CP has given the breakout from its last five weeks consolidation range of Rs 1,150-1,070 on the weekly closing basis. This breakout is accompanied with high volumes indicating increased participation.
The stock is forming higher top higher bottom formation on daily/weekly charts indicates sustained uptrend. The strength indicators are in positive territory which indicates positive momentum to continue further.
MORE WILL UPDATE SOON!!
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