Buy these two stocks for as much as 10% upside in coming weeks while Nifty battles volatility
November 5, 2020 8:41 AM
Nifty is currently nearing a crucial weekly resistance of the high of last one month around 11950-12025 levels.
Nifty has gained 4.6 per cent since last Diwali while Midcaps outperformed the Nifty and are up 9.3 per cent
By Nagaraj Shetti
Nifty witnessed a roller coaster ride on Wednesday, by showing intraday volatility on the backdrop of the US election and closed the day higher by 95 points. A long bull candle was formed on Wednesday that closed near the upper end of the day’s range.
Nifty is now entering a crucial resistance zone of around 11900-11950 levels and is now facing hurdle at the down sloping minor trend line. Hence, there is a possibility of consolidation or minor profit booking from around 11925-11950 levels in the next session. The expected profit booking is not expected to change the positive status of the short term trend, as we could see an emergence of buying from the lows of 11800 levels.
Nifty on the weekly chart sustained on a support of significant trend line at 11600 levels. Nifty is currently nearing a crucial weekly resistance of the high of last one month around 11950-12025 levels. Hence, there is a possibility of minor weakness from here or from the highs, before showing any sharp upside breakout of the hurdle.
The short term trend of Nifty remains positive. Having moved up sharply in the last two sessions and placed near the crucial resistance zone (11950-12050), there is a possibility of minor profit booking from the highs, before showing any upside breakout of the hurdle. Any dips down to 11800-11750 is going to be a buy on dips opportunity.
The Pharma stock (Divis Laboratories Ltd) has been moving in a larger consolidation pattern over the last couple of months. Now, the stock price is making an attempt to break above the upper consolidation range of Rs 3200 levels. We observe a formation of larger degree of positive sequence like higher tops and bottoms. The higher bottom formation was in line with the consolidation/range bound movement in the last two occasions. Hence, one may expect upside breakout in the short term. Weekly RSI is placed above 60 levels, which signal chances of further strengthening of upside momentum in the near term.
Buying can be initiated in DIVIS LAB at CMP (3200), add more on dips down to Rs 3075, wait for the upside target of Rs 3500 in the next 3-4 weeks. Place a stoploss of Rs 2980.
Buy COROMANDEL- (CMP Rs 744.15)
The weekly timeframe chart of Coromandel International Ltd signal a consolidation type pattern in the last couple of weeks. The down trend of the last few months seems to have completed, as the stock price has sustained above the long term support of uptrend line at Rs 682-later part of Oct.
Presently, the stock price is making an attempt to move above the initial resistance of Rs
745-750, as per the concept of change in polarity. We observe a larger degree of positive sequence like higher tops and bottoms over the last few months and the recent swing low of Rs 682 could be considered as a new higher bottom of the sequence.
Buying can be initiated in COROMANDEL at CMP (744.15), add more on dips down to Rs 705, wait for the upside target of Rs 825 in the next 3-4 weeks. Place a stoploss of Rs 685.
(Nagaraj Shetti is Technical Research Analysts at HDFC Securities. The views expressed are the author’s own. Please consult your investment advisor before investing.)