StocksMarket.in

Volatility in Nifty likely to cool off; here are 3 stocks that can give 4-9% return

Volatility in Nifty likely to cool off; here are 3 stocks that can give 4-9% return
January 10
12:28 2020

Amid heavy volatility in the last few sessions, the bulls reclaimed lost ground and a sharp pullback from lower levels was witnessed followed by two days of continuous upmove. Heavy fall on the back of US-Iran tensions was arrested at 50-day exponential moving average (DEMA), where the bulls have shown active participation.

In the coming days, the volatility is likely to settle down and the Nifty could go sideways in the wide range of 12,285 and 11,920.

Momentum indicators have left the bullish trajectory and are now trading in sideways zone, indicating that the upside seems to be limited. Taking a very short term time-frame into consideration, we could see the extension of this rally till 12,285 if 12,335 trades on the higher side but profit booking at higher levels would not be ruled out.

Gap support on the daily chart is placed at 12,130 and selling pressure could accelerate till 12,021 if the support level breaks. Medium term is still bullish and the higher top and higher bottom cycle is intact but ongoing volatility suggests that instead of regaining the uptrend, prices are likely to go sideways in the coming days.

Image11012020

The Bank Nifty, on the other hand, is likely to outperform the Nifty, where prices have bounced back from the important support levels and the RSI has formed a bullish reversal pattern. Traders should adopt buy on dips strategy in the banking index till its trading above 31,680.

NIFTY50

Three stocks that could offer 4 to 9 percent return in the short term:

Kotak Mahindra Bank: Buy | Target: Rs 1,731 | Stoploss: Rs 1,625 | Return: 4 percent

The stock has gone through a decent correction in the last few days but the higher top and higher bottom cycle is still intact. A bullish candlestick pattern is visible on the daily chart at 50-day exponential moving average support level and prices are trading above all major medium-term moving averages.

Reversal after retracement is expected in the counter and traders can initiate long positions at current levels with a short-term perspective.

Maruti Suzuki: Buy | Target: Rs 7,588 | Stoploss: Rs 7,030 | Return: 5 percent

The stock is going through the bullish crossover of major short-term and medium-term moving averages on the weekly chart. Prices are bouncing back from important support levels and the daily RSI has bounced back from important support levels.

Volatility breakout is visible on the intraday chart and the ongoing rally is expected to extend further and long positions can be initiated in the counter for short-term gain.

Tata Motors: Buy | Target: Rs 210 | Stoploss: Rs 179 | Return: 9 percent

The stock has given an initial signal of a trend reversal on the weekly chart and the RSI has started trading in a bullish zone for the first time after two years. Momentum indicators on the daily chart are bouncing back from important support levels, suggesting that the ongoing momentum is likely to continue.

On the intraday chart, prices are tagging the upper Bollinger band after a phase of contraction. Traders can enter long in the counter for short-term gain

Disclaimer: The views and investment tips expressed by investment experts on moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.Get access to India’s fastest growing financial subscriptions service Moneycontrol Pro for as little as Rs 599 for first year. Use the code “GETPRO”. Moneycontrol Pro offers you all the information you need for wealth creation including actionable investment ideas, independent research and insights & analysis For more information, check out the Moneycontrol website or mobile app.

Related Articles

Archives