Reliance, HDFC Bank among 4 technical stocks to buy; charts suggest bullish trend going forward

The short-term texture of Nifty is bullish but due to an overstretched intraday rally, bulls may prefer to take a temporary pause near 17275-17300.

RIL, Reliance Industries, HDFC Bank, stocks to buy, stock market
Technically, after a long time, the Nifty succeeded to close above the 20 day SMA which is broadly positive. Image: Pixabay

By Shrikant Chouhan

The benchmark indices continued positive momentum for the second day in a row. The Nifty 50 index ended 147 points higher while the BSE Sensex was up by 477 points. Among sectors, almost all the major sectoral indices traded in the green but the auto and smallcap index outperformed. After a strong opening, Nifty hovered within the range of 17160-17250 and BSE Sensex in the 57650-57950 range. Technically, after a long time, the Nifty succeeded to close above the 20 day SMA which is broadly positive.

We are of the view that the short-term texture of Nifty is bullish but due to an overstretched intraday rally, bulls may prefer to take a temporary pause near 17275-17300 and 58000-58100. The trading setup suggests a quick intraday correction is possible if the Nifty and Sensex succeed to trade below 17180 and 57750 levels, respectively; below the same the correction wave will move up to 17100-17160 and 57500-57300. On the other side, above 17200 and 57800, the index uptrend continuation formation will continue up to 17300 and 58100. Further upside may also continue which could lift the indices up to 17370 and 58300 levels.

Technical stocks to buy

HDFC Bank
BUY, CMP: Rs 1,460.8, TARGET: Rs 1,530, SL: Rs 1,430

Post consolidation for a few sessions near the support zone, the counter has given a breakout of its range bound move and it has formed a star candlestick formation which suggests reversal of trend and bullish strength for a fresh up move from the current levels.

Reliance Industries Ltd (RIL)
BUY, CMP: Rs 2,398.4, TARGET: Rs 2,520, SL: Rs 2,350

The stock was into a sloping channel after hitting the highs of around 2750, eventually, its downward move stopped near the retracement support zone and the strong rebound is seen in the counter, recent trend line breakout confirms bullish momentum to remain in the coming time horizon.

Berger Paints India
BUY, CMP: Rs 752.6, TARGET: Rs 790, SL: Rs 735

For the past few weeks, the stock was seen into a range bound mode, and presently the counter is trading near the breakout line of the Symmetrical triangle chart pattern. Hence, the recent price action indicates a strong breakout is very likely in a few trading sessions.

DLF
BUY, CMP: Rs 385.8, TARGET: Rs 405, SL: Rs 377

The counter has reversed from its trend line support and it is in a gradual up move which indicates that the counter has potential for further bullish movement from the current levels.

(Shrikant Chouhan is Head of Equity Research (Retail) at Kotak Securities. Views expressed are the author’s own.)

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