If the Nifty50 holds current levels and surpasses 17,200-17,300 in coming sessions, then 17,500 can be a possible target with crucial support at 17,000 followed by 16,800-16,750 levels
Sunil Shankar Matkar
October 03, 2022 / 10:18 AM IST
Indian benchmark indices ended lower in the highly volatile session on September 29 ahead of Reserve Bank of India policy announcement. At close, Sensex was down 188.32 points or 0.33% at 56,409.96, and the Nifty was down 40.50 points or 0.24% at 16,818.10.
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The market saw a relief rally of nearly 2 percent on Friday, taking support at 16,750, after consistent selling in previous seven consecutive sessions and looking oversold. This rally, on a weekly basis, helped the Nifty50 trim losses to little more than one percent, continuing downtrend for third straight week.
The index decisively gave a close above 17,000 mark as well as 200-day SMA (around 16,990). It has formed bullish Engulfing candlestick pattern on the daily charts and there was Hammer kind of pattern formation on the weekly scale at downtrend, indicating bullish reversal pattern.
Hence, if the index holds current levels and surpasses 17,200-17,300 in coming sessions, then 17,500 can be a possible target with crucial support at 17,000 followed by 16,800-16,750 levels, experts said.
“A move beyond 17,200 on a closing basis would strengthen the recovery rally. In this case, 17,350 – 17,500 levels cannot be ruled out. On the flipside, 16,900–16,750 has now become a sacrosanct support zone,” Sameet Chavan, Chief Analyst-Technical and Derivatives at Angel One said.
The market expert advised traders to keep a close tab on global developments and any favourable cues on this front would provide the much-needed push to the domestic markets.
Let’s take a look at the top 10 trading ideas by experts for the next three-four weeks. Returns are based on the September 30 closing prices:
Expert: Jatin Gohil, Technical and Derivative Research Analyst at Reliance Securities
ACC: Buy | LTP: Rs 2,415.65 | Stop-Loss: Rs 2,313 | Target: Rs 2,785 | Return: 15 percent
After a higher level of reversal (i.e. from Rs 2,785 to Rs 2,313), the stock formed a bullish reversal pattern – Morning Doji Star around its extended horizontal breakout line and poised for a fresh up-move. This could take the stock towards its life-time-high in the short-term.
The key technical indicators tested the oversold zone on short-term timeframe chart and on the verge of a bullish cross-over. A follow-up move will confirm the bullish reversal and support probable rise in the stock.
In case of any decline, the stock will find support around its recent swing low.
Persistent Systems: Buy | LTP: Rs 3,241 | Stop-Loss: Rs 3,092 | Target: Rs 3,923 | Return: 21 percent
The stock remained sideways after a trendline breakout, where volume was above average. This signals that bulls are gradually taking control, which will support a strong rise. Its daily RSI (relative strength index) and MACD (moving average convergence and divergence) are positively poised after a bullish cross-over.
We believe the stock will rebound utilising prior consolidation and could move towards its prior swing high. In case of any decline, the stock will find support around its lower band of the range.
Muthoot Finance: Buy | LTP: Rs 1,040 | Stop-Loss: Rs 950 | Target: Rs 1,214 | Return: 17 percent
The stock recovered from its 52-week low and breached its prior weekly falling trend. Rise in volume and bullish formation signals that major market participants are in favor of the bulls. The stock has potential to move towards its highest level of August 2022 in the short-term.
The key technical indicators reversed from the oversold zone and gave buy signal. As per the current set-up, the stock will soon resume its northward journey and could give desired action.
On the lower side, the stock will find support around its 52-week low.
Expert: Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities Ltd
Aegis Logistics: Buy | LTP: Rs 271.1 | Stop-Loss: Rs 254 | Target: Rs 300 | Return: 11 percent
The stock is forming a rounding bottom formation, which is visible on the daily chart if we consider the price action from June 2021 to date. Normally, we see a gradual rally in the stock, which takes time to reach the final target.
The starting point of the formation is Rs 387.90 which should be its ultimate target in the coming few months. However, in the near term, we can expect the stock to move towards the 300 level, which is the upper limit of the current consolidation.
Buy partly at current levels and balance at Rs 260, with a stop-loss at Rs 254.
GlaxoSmithKline Pharmaceuticals: Buy | LTP: Rs 1424.4 | Stop-Loss: Rs 1,370 | Target: Rs 1,500-1,575 | Return: 5-10 percent
The stock has taken support at Rs 1,370 several times since June 2020 which means that the level of Rs 1,370 has some fundamental significance. After hitting the Rs 1370 level, it jumps up to Rs 1,700, which is a decent upside.
For two months, the stock remained above Rs 1,370 level and bounced back repeatedly. Volume indicators and sectoral performance are also supporting the price action.
It is advisable to buy between Rs 1,430 and Rs 1,400. Place the last stop-loss at Rs 1,370 based on the closing. On the other hand, it might rally to Rs 1,500-1,575 in the next few weeks.
Trent: Buy | LTP: Rs 1,420 | Stop-Loss: Rs 1,350 | Target: Rs 1,500-1,600 | Return: 6-13 percent
It is consolidating above the breakout level, which was at Rs 1,350. It is a symmetrical triangle formation and on September 27, it has taken the support of the rising trend line of the triangle formation.
Based on it we can expect a minimum target of Rs 1,500 and a maximum of Rs 1,600 in the short term (few weeks). In the longer term, we are targeting Rs 1,700-1,800 level. Buying at current levels is advisable but with a stop-loss of Rs 1,350.
Expert: Subash Gangadharan, Senior Technical and Derivative Analyst, HDFC Securities
Federal Bank: Buy | LTP: Rs 118.75 | Stop-Loss: Rs 112 | Target: Rs 132 | Return: 11 percent
Federal Bank has corrected from a high of Rs 129.75 touched in early September 2022. The stock recently found support around Rs 109 levels which is close to the 50 days SMA (simple moving average). The stock subsequently bounced back sharply on Friday and closed above the 20 days SMA.
The bounce back came on the back of healthy volumes which is encouraging. Momentum readings like the 14-day RSI too have bounced back and are in rising mode now.
With the intermediate technical setup too looking positive, we believe the stock has the potential to move higher in the coming weeks. Recommend a buy between Rs 117-120 levels. Stop-loss is at Rs 112 while target is at Rs 132.
Dixon Technologies: Buy | LTP: Rs 4,371.6 | Stop-loss: Rs 4,110 | Target: Rs 4,900 | Return: 12 percent
After correcting from a high of Rs 6,244 in October 2021, Dixon found support around Rs 3180 levels in May 2022. These are strong supports as the stock has found support around these same levels in the past. Recently, the stock reversed its downtrend by crossing its previous swing high of Rs 4,020.
Technical indicators are giving positive signals as the stock is trading above the 20 and 50 days SMA. Momentum readings like the 14-week RSI too are in rising mode and not overbought, which implies potential for further upsides.
With the intermediate setup too looking attractive, we expect the stock to move up towards its previous intermediate highs in the coming weeks. Buy between Rs 4,350-4,440 levels. Stop-loss is at Rs 4,110 while target is at Rs 4,900.
Sun TV Network: Buy | LTP: Rs 508.85 | Stop-Loss: Rs 495 | Target: Rs 535 | Return: 5 percent
Sun TV has corrected from a high of Rs 538 touched in mid-September 2022. The stock recently found support around Rs 486 levels which is close to the 50 days SMA. The stock subsequently bounced back smartly on Friday and closed just below the 20 days SMA.
The bounce back came on the back of healthy volumes which is encouraging. Momentum readings like the 14-day RSI too have bounced back and are in rising mode now.
With the intermediate technical setup too looking positive, we believe the stock has the potential to move higher in the coming weeks. Recommend a buy between Rs 508-512 levels. Stop-loss is at Rs 495 while target is at Rs 535.
Expert: Ruchit Jain, Lead Research, 5paisa.com
Bharti Airtel: Buy | LTP: Rs 800 | Stop-Loss: Rs 768 | Target: Rs 838-856 | Return: 5-7 percent
The stock has formed a ‘Higher Top Higher Bottom’ structure in last few weeks and has shown a relative outperformance in the recent corrective phase. The stock rallied higher on Friday and has given a breakout from the recent trading channel.
The RSI readings on the weekly charts indicate a positive momentum and hence, we expect a continuation of the uptrend in the near term.
Hence, traders can buy the stock in the range of Rs 800-790 for potential short term targets of Rs 838 and Rs 856. The stop-loss on positions should be placed below Rs 768.
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.
