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Nifty likely to hit 10,670; top 5 stocks which can give up to 16% return

April 16
14:02 2018

Rajesh Agarwal

Nifty rose for three consecutive weeks, surging by 1.48 percent to close at 10,480.60. On weekly time frame, Index has formed ‘Three White Soldiers’ that predicts the reversal of a downtrend. It is likely to retest 10,650-10,670 levels on upside i.e. Inner Trendline which might work as immediate hurdle zone. On shorter time frame, the levels 10,550 levels may act as near term hurdle i.e. 50 percent Retracement level.

Furthermore, RSI (14) has given positive crossover on weekly time scale. Moreover, Indicators like ADX (14) is falling, signifying Index to consolidate in near term within broader range.

Bank Nifty

Nifty Bank has formed ‘Three White Soldiers’ candlestick pattern on weekly time frame suggesting a possible change in trend. On shorter time frame, it has formed ‘Doji’ candlestick pattern around hurdle zone indicating indecision among bulls & bears. It is currently trading within its two major moving averages of 50 SMA and 100 SMA.

Strong hurdle seen around 25,420 levels. Now Nifty Bank has to cross this mark decisively for further up move. If Index fails to cross this level, Nifty Bank may correct till 24,700 zones. Furthermore, RSI (14) has given Bullish Cross on weekly scale which is a bullish sign.

Below are the top 5 stocks which can give up to 16% return in the near term:

TVS Motor Company | Rating: Accumulate around Rs 652-655 | Target: Rs 720, stop loss: Rs 620 | Return: 10%

The stock has given breakout from ‘Falling’ trendline on weekly chart indicating resumption of previous up-trend. Strong auto sales numbers on March 2018 is likely to boost investors’ sentiments in near term. Moreover, RSI (14) has given positive crossover which is bullish set-up.

Accumulate TVS Motor around Rs 652-655 with stop loss below Rs 620 for target of Rs 720.

CRISIL | Rating: Accumulate around Rs 1900-1920 | Target: Rs 2200, stop loss: Rs 1750 | Return: 16%

The stock has formed probable formation of ‘Cup & Handle’ pattern around strong support zone of Rs 1760 levels. Sustenance trade above Rs 1940 levels may add momentum on upside. Moreover, MACD is trading around ‘Zero’ level.

We are expecting the stock to retest its all-time high in near term till it sustains above Rs 1750 zone. Accumulate Crisil around Rs 1900-1920 levels with stop-loss at Rs 1750 on closing basis for target of Rs 2200.

Bajaj Auto | Rating: Buy around Rs 2785-2790 | Target: Rs 3010, stop loss: Rs 2700 | Return: 8%

Bajaj Auto has formed two consecutive ‘Inverted Hammer’ followed by ‘Doji’ candlestick pattern around ‘Inflection Point’ i.e. upward sloping trendline and 78.60 percent Retracement level on weekly chart signifying possible change in trend. Moreover, RSI (14) has turned up from 35 levels which is a bullish sign. Indicators like DMI’s is indicating halt in current downfall as (-) DI is falling & (+) DI is turning flat. Buy Bajaj-Auto around Rs 2785-2790 with stop loss at Rs 2700 on closing basis for target of Rs 3010.

Jindal Steel & Power | Rating: Buy around Rs 248-251 | Target: Rs 279, stop loss: Rs 235 | Return: 12%

Jindal Steel & Power has given breakout from ‘Descending Channel’ on daily time frame and closed above all its major moving averages. Furthermore, MACD has crossed ‘Zero’ mark which is a bullish set-up. Buy Jindal Steel around Rs 248-251 levels with stop loss of Rs 235 on closing basis with target at Rs 279.

Gujarat State Fertilizers & Chemicals | Rating: Accumulate around Rs 125-128 | Target: Rs 143, stop loss: Rs 120 | Return: 14%

Gujarat State Fertilizers&Chemicals has given breakout from small ‘Inverted Head & Shoulder’ pattern on daily time frame. It is a bullish reversal pattern signifying prices to move higher from current market price. Furthermore, Oscillators like RSI & MACD are trading around positive territory. Accumulate GSFC around Rs 125-128 levels with stop loss at Rs 120 on closing basis for target at Rs 143.

Disclaimer: The author is the Head of Research, AUM Capital Markets. 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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