Buy these two stocks for gains while Nifty uptrend continues, short-term correction not ruled out

On the Nifty daily chart, we can observe that after recently touching a low of 15183, the 50-stock index has been consistently rising and making higher tops and higher bottoms over the last few weeks.

Buy these two stocks for gains while Nifty uptrend continues, short-term correction not ruled out
Technical indicators too are giving positive signals as rising 20-day SMA is above the rising 50-day SMA.  (Image: REUTERS)

By Subash Gangadharan

On the Nifty daily chart, we can observe that after recently touching a low of 15183, the 50-stock index has been consistently rising and making higher tops and higher bottoms over the last few weeks. And this week, the Nifty broke out of a downward sloping trend line that held down the highs of 2021 and 2022. Technical indicators too are giving positive signals as rising 20-day SMA is above the rising 50-day SMA. 

We, therefore, feel that the uptrend is likely to continue. We must, however, remember that the current short-term uptrend is matured and could witness a short-term correction in the near term. This would also be healthy for markets as it would give an opportunity for new positions to be built. Supports to watch for weakness are now at 17764-17597. The below picks are for the next 15-26 trading sessions

Buy ICICI Securities

ICICI Securities has been rallying higher for the last few sessions after finding support at the 411 levels. In the process, the stock has broken out of its recent trading range. Technical indicators are giving positive signals as the stock is trading above the 20 and 50-day SMA and recently there was a positive moving average crossover as the 20-day SMA moved above the 50-day SMA. Momentum readings like the 14-week RSI are in rising mode.

Also Read: Syrma SGS IPO GMP falls; last day to subscribe to Rs 840 crore public issue

With the intermediate technical setup too looking positive, we believe the stock has the potential to move higher in the coming weeks and therefore recommend a buy between the 510-530 levels. CMP is 520.0. Stop loss is at 465 while the target is at 620.

Buy ICICI PRULI

ICICI PRULI has shown relative strength this week. While the Nifty index has gained 1.01% this week, ICICI PRULI has gained 6.39% over the same time period. Zooming into the daily chart, we can observe that the stock has made a double bottom around the 480 levels and broken out of the recent trading range on Thursday on the back of above average volumes.

The stock is now trading above the 20 day and 50 day SMA. And momentum readings like the 14-week RSI are in rising mode and not overbought, which implies potential for more upsides. With the intermediate technical setup looking positive, we believe the stock has the potential to move higher in the coming weeks and therefore recommend a buy between the 590-600 levels. CMP is 595. Stop loss is at 560 while target is at 660.

Also Read: Rupee likely to depreciate amid rise in crude oil prices; USDINR pair to trade in this range

(Subash Gangadharan is a Senior Technical and Derivative Analyst at HDFC Securities. The views expressed are the author’s own. Please consult your financial advisor before investing.)

Get live Share Market updates and latest India News and business news on Financial Express. Download Financial Express App for latest business news.

Photos