Nifty outlook and few trading ideas by Sameet Chavan, Chief Analyst- Technical & Derivatives, Angel Broking:
It seems that markets
are enjoying their merry days and are in no hurry to provide a much awaited correction. On Wednesday, we saw intimidating move and somehow reminded of a sharp sell-off seen during the penultimate week. But, markets
are in a different mood and have once again displayed their strength by clocking a new record high of 10,191.
Technically speaking, the index has been vacillating within the boundaries of a ‘Broadening’ pattern since last three months. As per the theory, the higher end is placed in the range of 10,200-10,220. We still believe that one should not trade aggressively in the market as there is a series of divergences on ‘RSI-Smoothened’. Yes, market is not obliging this indicator; but, considering historical performances of this indicator, we need to give some respect. Our strategy is to keep focusing on individual stocks and one should keep booking profits in rallies.
For the coming session, immediate resistance would be seen at 10,200-10,220 and a sustainable move beyond this would extend this rally. On the flipside, 10,120-9,955 are likely to act as strong support levels. Being a Diwali week, we expect some kind of consolidation in the market.
1) Radico Khaitan
Last Close: Rs 187.90
This stock has been a clear outperformer within this space. Recently, the stock managed to give a decent recovery after retesting its breakout zone of 156-154. On Friday, we witnessed yet another breakout from the ‘V’ pattern along with decent rise in volumes. Hence, we recommend buying this stock at current levels for a target of Rs 207 over the next 14 to 21 sessions. The stop loss now should be fixed at Rs 177.
Last Close: Rs 466.55
If we look at the weekly time frame chart, the stock has been maintaining its sturdy structure since last many months. Recently, we saw some kind of time correction in the stock. However, on Friday, the stock managed to surpass its Horizontal Line resistance with sizable volumes; indicating massive buying interest coming back into the counter. One can buy this stock for a target of Rs 499 over the next 5-10 sessions. The stop loss should be fixed at Rs 445.
Disclaimer: The analyst may have positions in any or all the stocks mentioned above.