The sharp correction in Nifty 50 has not changed the macro trend and one can still find stocks worth investing in. These 4 IT stocks still have steam left and can propel the index further
By Manish Hathiramani
The Nifty has been moving from strength to greater strength and continues to project a strong momentum going forward. While short term corrections and profit booking phases cannot be ruled out, the overall trend remains bullish. We just witnessed a sharp correction a couple of days back where from a high of 13777 the Nifty made a low of 13131. This has not changed the macro trend and one can still find stocks worth investing in. I have shortlisted a few stocks within the IT pack which in my opinion still have steam left and can propel the index further.
INFOSYS: This stock has made a good base around the 1000-1050 levels. Although we have experienced range bound movements in the last month or so, it has been rising slowly and steadily. 1186 was the intermediate high recorded on this stock and we are now trading above that level. It has also nudged its medium-term resistance of 1205. This makes it a good buy candidate. From a trading perspective, we can target 1250 with a stop loss at 1080 and from an investment horizon, one can target levels closer to 1450-1500 with a stop loss at 900.
TCS: It was imperative for this stock to get past 2450 on a closing basis for an investment buy which it did with complete ease. The stock continues to remain in the hands of the bulls and we should endeavor a short term target of 3000 with a stop loss of 2800. From an investment perspective, the target would be 3200 with a stop loss of 2600.
HCL TECH: The level of 800 was a good support point for this stock and we were able to bounce from there rather quickly and in a span of 4-5 weeks we are trading above 900. There is still a lot of steam left and we could project a target of 1070-1100 and place a stop loss at 795.
WIPRO: This stock has a similar chartical structure to HCL TECH. The resistance level was 290 which the stock flew out of and achieved 370-380 in just 3-4 weeks. We are headed higher and can trade for a target of 420 and a stop can be placed at 310.
(Manish Hathiramani is a proprietary index trader and technical analyst at Deen Dayal Investments. Views expressed are the author’s own. Please consult your financial advisor before investing.)