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Nifty above 8,800; Should you buy or sell these 6 stocks?

NSE Nifty index surpassed the crucial mark of 8,800 in the early trade on Friday tracking firm global markets.

By: | New Delhi | Updated: September 16, 2016 11:03 AM
bse sensex, nse nifty, NSE Nifty index surpassed the crucial mark of 8,800 in the early trade on Friday tracking firm global markets. (Photo: PTI)

NSE Nifty index surpassed the crucial mark of 8,800 in the early trade on Friday tracking firm global markets. At 10.40 pm, the 50-share index was trading 100.80 points, or 1.15 per cent, up at 8,843.35. Among the 51-component in the Nifty index, 47 stocks were trading in green with Bajaj Auto suring 2.67 per cent, followed by Hero MotoCorp (up 2.65 per cent), Bank of Baroda (up 2.22 per cent), Maruti Suzuki (up 2.13 per cent) and State Bank of India (up 1.89 per cent). On the other hand, HDFC, Lupin and Asian Paints were down by 0.13 per cent, 0.12 per cen and 0.05 per cent, respectively.

Meanwhile, Sumeet Bagadia, associate director at Choice Broking gave his 6 technical calls for the next 4-5 trading sessions. The market expert is bullish on HCL Technologies and Sun Pharma. However, he has given ‘Sell’ rating to Adani Ports, ICICI Bank and ACC.

1) HCL Technologies: On daily chart, after decent correction from 860 level, stock has managed to sustain near to its 50-day moving average which is placed at 769 level, which shows that stock could further accelerates its upside movement. Moreover, stock has multiple support at 760-750 level, which shows that bounce back can be seen in few trading sessions. A momentum indicator RSI reading is at 48.65 and about to make positive crossover, which point out for positive breath in the stock. We have Buy rating on HCL Technologies with target price of Rs 830-850 and stop loss at Rs 750.

2) Sun Pharmaceuticals: On weekly chart, stock has formed Bullish harami candlestick which is a bullish reversal candle and indicates for upside movement. Moreover, on daily chart, stock has been trading above its 21-day moving average which shows that near term trend is up. Even on hourly chart, stock has strong support at 775 level, a level which acted as good support in past, shows that stock may give further bounce back move from the present level. A momentum indicator RSI reading is at 47.45 level with positive crossover, which point out for positive breath in the stock. Trader can ‘Buy’ Sun Pharma for a target of Rs 820 with stop loss at Rs 758.

3) Adani Ports: On weekly chart, stock has formed Bearish engulfing candlestick which is a bearish reversal sigh and indicates for downside movement. Moreover, on daily chart, stock has formed double top formation which also represents bearish reversal movement. A momentum indicator RSI reading is at 55.75 level with negative crossover, besides RSI trending with downward sloping trend line, which point out for negative breath in the stock. We have ‘Sell’ on Adani Ports with target price of Rs 245 and stop loss at Rs 280.

4) ICICI Bank: After forming a low at 180 level stock has posted move upto 280 level which is almost 56 per cent gain in 27 weeks. Concern of this move was stock has rallied in overlapping manner which indicate lacklustre move. With this upside move stock has retraced to 50 per cent of its earlier fall, it can be potential resistance for stock. On the daily chart stock has faced resistance from supply zone which enhance possibility of reversal from current level. We have sell on ICICI Bank shares with a target price of Rs 258 with stop loss of Rs 276.

5) ACC: Contrarily, cement stocks have moved against the general wisdom that in monsoon season this sector generally under perform. This time it seems that there is mild shift in time cycle. Technically, on monthly chart stock has formed hanging man pattern which correspond to previous top, it can be potential double top which is bearish reversal pattern. On weekly chart as well stock has breached its 6 week consolidation phase, it indicates stocks has distributed or change in hands at higher level. We have sell on the stock with target price of Rs 1570 and stop loss at Rs 660.

6) Tata Communications: On weekly time frame stock has formed a spinning top which is bearish reversal sign. Stock started to trade below its 21-day short term moving average which shows nervousness in short term. We have sell on Tata Communications shares with target price of Rs 470 and stop loss at Rs 520.

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