By Subash Gangadharan
On the Daily chart, we observe that Nifty has now reversed the recent short-term downtrend by crossing the previous swing high of 17,468 and also closing above the 200-day EMA last Friday. Our upside targets for Nifty are at 17,850-18,004, which corresponds to the 50-day SMA and previous resistances. The intermediate trend however remains down and will reverse only on the move above 18,135. The current Short term uptrend would reverse if the support of 17,306 is broken.
The below picks are for the next 15-26 trading sessions
Buy Linde India
Linde India has been rallying higher this week after finding support at the Rs 3,681 level last week. 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. Momentum readings like the 14-day RSI are in rising mode and at 69.2 is not overbought. 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 Rs 3,870-3.910 levels. CMP is Rs 3,898. Stop loss is at Rs 3,725 while target is at Rs 4,150.
Buy Sterling and Wilson Renewable Energy
Sterling and Wilson Renewable Energy has recently bounced back from the support of Rs 256. The stock had previously found support around the same levels in August 2021. This indicates that the Rs 256 level is strong support and is likely to hold for a while. On Wednesday, the stock has broken out of its recent 3-week trading range on the back of above-average volumes. Momentum indicators like the 14-week RSI too are climbing higher and are not yet overbought, implying the potential for more upsides. 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 Rs 313-317 levels. CMP is Rs. 315. Stop loss is at Rs 300 while target is at Rs 340.
(Subash Gangadharan is Senior Technical and Derivative Analyst at HDFC Securities. Views expressed are author’s own.)