Top 10 money-making ideas by experts which would give up to 14% return in short term
After a sharp correction seen throughout in the month of March, analysts feel that the Nifty could see a bounce back which could take the Nifty towards 10300-10400 levels. But, that would just be a ‘Dead Cat Bounce’ as the pain is not yet over.
Bears ruled Dalal Street in the week gone by but this week could well belong to the bulls, suggest technical experts tracking the market. The Nifty50 which closed with a loss of 2.2 percent for the week ended March 9 but the pullback rally could take Nifty towards 10300-10400 levels, they say.
A large part of the decline was led by banking stocks as more bad news flowed into the sector. The banking regulator penalised four banks including State Bank of India (SBI) and Airtel Payments Bank for breaching RBI norms.
On the global front, the market sentiment remained weak amid weak global cues on the prospects of trade wars initiated by the US President Donald Trump which led to weakness in markets across the globe.
The BSE-30 Index dropped over 2 percent to close at 33,307 while the Nifty50 slipped by 2.2 percent for the week ended March 9. The index breached key support levels but managed to defend its 200-days exponential moving average which was placed around 10070.
After a sharp correction seen throughout in the month of March, analysts feel that the Nifty could see a bounce back which could take the Nifty towards 10300-10400 levels. But, that would just be a ‘Dead Cat Bounce’ as the pain is not yet over.
This was clearly an action-packed week for our traders as we once again saw some trended move after a consolidation of nearly three weeks. This was clearly on cards; but as we all know, timing such moves is not as easy as it looks in the hindsight.
For a positional trader, it is always a prudent strategy to remain with the trend when it is in the early stages. The near-term trend turned lower after confirming the ‘Bearish Engulfing’ pattern at the end of the ‘Budget week.
Addition to this, the ‘RSI-Smoothened’ slipped below the 70 mark and now we can see prices closing below the ’20-EMA’ on the weekly time frame for the first time after January 2017.
We would continue with our ‘sell on rise’ approach and would expect the index to the first slide towards 10033 and then eventually to enter sub-10000 levels quite soon. However, before this, 10140 – 10350 has become a no-trade zone for the market. If any negativity has to resume, it would only happen after violating the 10140 mark.
He further added that the ideal scenario to initiate short position would be either below this crucial junction or after seeing a decent relief rally towards the higher end i.e. 10350 – 10400. As of now, we do not expect the Nifty to surpass these hurdles in coming days.
Traders should remain light and avoid taking undue risks in such kind of uncertainty and in case of some relief rally within the consolidation range, traders should focus on individual stocks.
We have collated a list of ten trading ideas which can give up to 14% return in the short term:
Bank of Baroda Ltd: BUY| Target Rs 142| Stop Loss Rs 128| Return 8%
We are not trying to make any kind of bottom fishing as the entire PSU banking basket is like a falling knife for the last three weeks. But, the way this stock behaved in the last three sessions, we tempted to take a trading punt with a small stop loss.
The stock is extremely oversold as reflected on the daily time frame charts along with a couple of ‘Doji’ candles around the 130 mark.
Since, the risk is very small i.e. hardly a couple of percent from current prices, it calls for a good contra-buy for the coming week. In case of a bounce back, we may see a good relief move towards Rs.142 levels.
However, considering the recent underperformance, traders are advised to follow a strict stop loss placed below Rs.128 for this trade.
Ultratech Cement Ltd: SELL| Target Rs 3896| Stop Loss Rs 4174| Return 7%
The stock prices consolidated for nearly a month after witnessing a sharp correction from the all-time high of 4600. On Friday, there were some hints that the stock could break below this consolidation range and therefore, confirms a resumption of a downward move.
The momentum oscillators in the weekly time frame are sloping southwards, which adds conviction to the cautious stance on the counter. We advise going short for a target of Rs.3896 for the coming week, and one should place a strict stop loss below Rs.4174.
Tata Steel Ltd: SELL| Target Rs 625| Stop Loss Rs 647| Return 9%
Looking at Friday’s sharp fall, it is no brainer going short on this counter. But, we have been quite vocal on the probable correction before the Budget time and have been advising traders exiting longs around their recent highs.
In fact, ‘Tata Steel’ was the one stock that we advised going contra-short around its peak. This was mainly after prices entering its major resistance zone of 161% reciprocal retracement on the monthly chart. It is good to see the real impact of this important ‘Golden Ratio’.
Now, finally, prices confirmed its bearish trend after breaking down below recent ‘make or break’ level of 632. We continue to expect this stock sliding towards 570 – 550 in days to come.
Since the stock has already fallen a lot, it’s advisable to wait for some bounce back towards 620 – 625, which will make the risk-reward ration a bit favorable. One can look to go short around it with a strict stop loss of Rs.647.
Jay Purohit -Technical & Derivatives Analyst, Centrum Broking Limited
Motherson Sumi: BUY| Target Rs 350| Stop Loss Rs 298| Return 10%
The stock has corrected sharply in the last few days and has reached to its strong support zone of Rs300-305. The stock made a ‘double bottom’ formation and has started rebounding from the mentioned support zone to form a couple of 'Hammer' candles on the daily time frame charts.
This was followed by a positive momentum in the last couple of trading sessions, which indicates a possibility of a reversal in the short term trend.
Also, the momentum oscillator ‘RSI’ is showing positive divergence on the daily chart and is showing strength in the counter. Looking at the current chart structure, we are expecting a bounce in the stock towards Rs350 levels in coming couple of weeks.
Any decline towards 310 should be used as a buying opportunity with a stop-loss of 298.
Bharti Airtel: BUY| Target Rs 445| Stop Loss Rs 379| Return 11%
The stock is moving in a corrective phase from the last ten weeks and has also corrected by more than 25 percent in the same time. Currently, we are witnessing a formation of a Bullish Harmonic pattern called ‘Bullish Bat’ on the daily charts.
The Potential Reversal Zone (PRZ) is placed in the zone of Rs387 – 393. The ‘RSI’ oscillator is showing a series of positive divergence on the daily chart, indicating a possibility of a short-term reversal.
Looking at the above technical evidence, traders are advised to buy the stock on declines for the target of Rs435 – 445 with a stop-loss below 379.
Jubilant FoodWorks: BUY| Target Rs 2350| Stop Loss Rs 1960| Return 14%
The stock has outperformed the broader market in the recent past as it didn’t correct too much in the ongoing correction seen in the market.
From the last two sessions, the stock is showing strength and is now coming out of a short-term consolidation phase. Also, the ‘RSI’ on the weekly chart is showing a positive reversal and thus indicating resumption in the uptrend in the coming weeks.
Considering current chart structure, we advised traders to buy the stock with the stop-loss of 1960, and on the upside, we may see targets ranging from 2300 – 2350 levels.
Vakrangee Ltd: BUY| Target Rs 216 | Stop Loss Rs 180 | Return 10%
After trading in a downward momentum for a series of consecutive session, Vakrangee took a strong bottom base at 154 levels and continued to rebound in a positive trajectory.
The scrip breached its short-term moving average placed at 174 levels with substantial growth in volume which signalled a positive momentum.
On the weekly price chart, the scrip made a strong bullish candlestick pattern coupled with bullish crossover on MACD made during last week’s trade.
Further, the RSI level at 58 up from earlier level sign positive cues. The scrip is currently holding support at 179 and resistance level is seen at 225. We have a BUY recommendation on the counter which is currently trading at Rs. 195.75
Geojit Financial Services Ltd: BUY| Target Rs 109 | Stop-loss Rs 90 | Return 8%
Geojit Financial witnessed a robust momentum towards the weekend session despite trading in a sideways direction for a week, as it made a positive breakout from its 20-days EMA level.
Further, Bollinger bandwidth suggests a positive breakout from its upper band placed at 117 which is likely to build the uptrend trajectory. After closing on about 6 percent gain on an intraday basis, the scrip made a solid bullish candlestick pattern on its daily price chart.
Further, the RSI at 51 levels has given a favourable buying regime coupled with positive cues on MACD.
With price trading above crucial levels, the scrip is now facing a resistance at 118 levels and support level at 89. We have a BUY recommendation for Geojit Financial which is currently trading at Rs100.95
Pidilite Industries Ltd: BUY| Target Rs 980| Stop Loss Rs 820| Return 12%
The stock closed at Rs878.70 on 9th March 2018. It made a 52-week low at Rs680 on 10th March 2017 and a 52-week high of Rs. 971.70 on 26th December 2018.
The 200-days Exponential Moving Average (EMA) of the stock on the daily chart is currently at Rs. 831.87. The stock is continuously trading in higher highs and higher lows on weekly charts which is bullish in nature.
From the past few weeks, it was consolidating in the range of 840-910 levels and formed a “Triangle” pattern. Although, the stock has not given the pattern breakout bias is looking positive for the stock.
Therefore, one can buy in the range of 865-875 levels for the upside target of 960-980 levels with SL below 820.
Tata Elxsi Ltd: BUY| Target Rs 1120| Stop Loss Rs 930| Return 12%
The stock closed at Rs. 1002.35 on 09th March 2018. It made a 52-week low at Rs. 641.17 on 24th May 2017 and a 52-week high of Rs. 1123.25 on 24th January 2018. The 200-days Exponential Moving Average (EMA) of the stock on the daily chart is currently at Rs. 913.83
The stock is forming an “Inverted Head and Shoulder” pattern on the weekly charts, which is considered to be bullish. It took more than 2 years to form the pattern so the potential of rise is quite strong.
Apart from this, technical indicators such as RSI and MACD are also suggesting buying the stock. Therefore, one can buy in the range of 980-990 levels for the upside target of 1100-1120 levels with a stop loss below 930.
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