The Nifty regained momentum in the preceding five sessions, after last week’s
decline, led by broad-based buying and supportive global cues.
We continue to maintain our positive stance and expect the index to head towards a
target of 10,600 levels in the coming weeks as it is the measuring implication of the
Bullish Double Bottom pattern formed during the August – September period.
The Nifty50 held on to its key support of 10,100 levels during the recent decline from
10,490, as it is the confluence of following:
- The bullish gap area leading to the breakout from three-month range is placed
around 10,123-10,096 region
- 50 percent retracements of current up move (9,687-10,490) are placed at 10,094
levels
- Equality of preceding decline (10,178-9,687=491 points) as calculated from life high
of 10,490 is placed around 10000 levels
We believe current round of profit booking will make the market healthier by working
off short-term overbought conditions.
Structurally, the rally from September 2017 lows (9,687 to 10,451 = 764 points) is
larger in magnitude compared to the preceding rally of July-August 2017, measuring
689 points.
The rally getting bigger highlights inherent strength in the trend amid persistent
demand at elevated levels and augurs well for the continuance of the up move going
forward.
Here is a list of top three stocks which could give up to 16% return in the next 6
months:
Tata Chemical: BUY| CMP Rs736| Target Rs805| Stop Loss Rs695| Return 9%|
Time Frame 1 month
Tata Chemical has resumed its up move after consolidation above the recent trend line
breakout area signalling a change of polarity as previous trend line resistance reverse
its role and acting as support.
The stock after three weeks of profit booking, which has been characterized by
shallow correction has broken above prior week’s high indicating resumption of up
move and offers fresh entry opportunity.
The lower band of recent consolidation was placed at Rs702 levels is likely to act as
support in the short term. Weekly 14-period’s RSI is in a strong uptrend forming
higher high and higher low and is seen rebounding taking support at its nine period’s
average thus supports the continuation of the uptrend in the short term
Based on the above technical observation we expect the stock to head towards Rs805
levels over the coming month being the 161.8% external retracement of recent decline
(Rs765-702) placed at Rs805 levels
MOIL: BUY| CMP Rs252| Target Rs282| Stop Loss Rs232| Return 12%| Time
Frame 1 months
MOIL Ltd has witnessed a strong breakout rally during October 2017 rallying from
Rs190 to 52 weeks high of Rs285. In the process, the stock has registered a resolute
breakout above the rebounding pattern containing the entire price activity since
January 2017 to October 2017.
Post the breakout rally the stock has entered a shallow correction in the last three
weeks to work off the overbought condition developed during the previous rally
The stock has recently resumed its up move after consolidating near the 38.2%
retracement of the previous rally placed around Rs242 levels, which is likely to act as
major support for the stock in short-term.
Among oscillators, the weekly MACD (E-12/26/9) which measures the underlying
strength in the trend had entered into rising trajectory since August 2017 and is
currently diverging from its 9-period average highlighting strong bullish momentum
and indicates strength in the price structure
Based on aforementioned technical observations, we believe the consolidation phase
over the last three weeks has approached maturity, thus offering fresh entry
opportunity. We expect the stock to resolve higher and test its recent high of Rs285 in
coming weeks
Oberoi Realty: BUY| CMP Rs509| Target Rs590| Stop Loss Rs465| Return 16%|
Time Frame 6 months
The stock remains in a well-established uptrend and continues to inch northwards in a
rising peaks and troughs manner on medium time frame charts.
Structurally, the rallies are becoming bigger and swifter underlying the robustness in
the price structure along with strong momentum. At the same time, corrections are
short-lived and shallow in nature which is the sign of the consistent appetite for the
stock at elevated levels.
In the current week, the share price has resumed its uptrend following the two-week
breather, as it breaks out of Bullish Flag continuation pattern. Breakout from bullish
flag pattern offers a fresh entry opportunity to ride prevalent uptrend in the stock.
Based on aforementioned technical observations, we believe the stock price is
expected to continue its current upward trend. We have projected a medium-term
target of Rs590 based on the measuring implication of the bullish Flag pattern
breakout.
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