Alpha Tech basket comprises stocks from a diversified platform and consists of four stock recommendations based on technical ideas with a time perspective of a month
The short term trend of Nifty continues to be positive and one may expect further upside in the market for the short term.
Indian share market benchmarks BSE Sensex and Nifty 50 have gained nearly 5 per cent so far in October. Analysts are of the view that markets will continue to trade volatile till US elections. Newsflow related to COVID-19 vaccine and rising coronavirus cases will also sway the investor sentiment. With a view to outperform the market and at the same time to gauge the volatility, research and brokerage firm Anand Rathi Financial Services has prepared Alpha Tech basket, which comprises stocks from a diversified platform. It consists of four stock recommendations based on technical ideas with a time perspective of a month.
The brokerage firm sees a potential upside of 7 per cent from the previous close and recommended an entry range of Rs 395-400 with a stop loss of Rs 373. The stock has been trading with negative bias for quite some time and has been placed below all its major moving average. On technical parameters, the stock has retraced near to its 61.80% of the Fibonacci retracement drawn from the lows of 312 to the recent high of 612 which implies the stock is at a good support zone and any sustenance above this may trigger fresh addition in the counter. Looking at the data point it could be concluded that the stock could see a reversal in the current trend and one may look forwards to accumulate the stock from short to medium-term perspective.
It will take Divi’s Laboratories shares to jump 12.7 per cent to hit the target price pegged by Anand Rathi. It has advised an entry range of Rs 3150-3180 with a stop loss at Rs 2985. The stock has been trading with secular uptrend consecutively from past few trading months and has maintained the cycle of higher highs, higher lows indicating inherent strength. On technical parameters, 14 period RSI has seen significant support from the levels of 40 post reversal from the higher region of oversold placed around the 85-86 odd zone, suggesting potential support and rebound from the current levels. Going forward, looking at the data points one may consider to accumulate the stock at the mentioned price levels from short to medium-term perspective.
Anand Rathi in its report highlighted that Muthoot Finance has provided a breakout from a flag and poll pattern on the weekly scale and the conservative target of this pattern is coming around 1280-1300. The stock is also taking the support of its short term 21-DMA and trading well above its long term 200-DMA. The stock is placed at the mean of the Bollinger band on a weekly chart and is able to sustain above the same from past few trading weeks suggesting it to be a strong support zone. Even it has been seen historically that the stock has bounced from the mean several times to generate healthy returns. The recommended entry range is 1170-1185 with stop loss at 1100.
Anand Rathi sees a potential upside of 10.42 per cent from the previous close. It has provided a breakout from its one-year consolidation and surpassed its major hurdle of 3200. It is also trading well above its short-term and long-term moving averages. It also surpassed its 200-weekly moving average which has acted as key support and resistance in the past. The volumes were also higher than average in the past couple of weeks which also supports the breakout. So, based on the above rationale we can expect further momentum in the stock.
(The stock recommendations in this story are by the respective research and brokerage firm. Financial Express Online does not bear any responsibility for their investment advice. Please consult your investment advisor before investing.)