Bullish on Wockhardt with a target of Rs 730, SL of Rs 629: Angel Broking

Stock calls and outlook on Nifty by Sameet Chavan, Chief Analyst- Technical & Derivatives, Angel Broking:

Nifty outlook

The index continues to enjoy its Bull Run despite some in between hiccups. After the previous week’s consolidation, we had a head start on Monday by opening higher and in a couple of days, hastening beyond milestones of 11,600 and 11,700. However, traders once again chose to take some money off the table and hence, the index came off a bit from higher levels thereafter. Although, we did not see a significant move on Friday in terms of gains; it was quite encouraging because index managed to hold its ground and showed some signs of recovery towards the fag end of the week. 

If we compare the price activity of the week gone by and the previous one, we can clearly see it was quite identical in nature. On both occasions, the beginning was good; but the market struggled to sustain at higher levels. We would have interpreted this as a caution if the damage was bigger. But since it’s not the case, we would rather construe this as a sign of strength considering the small but crucial recovery on Friday. Since the chart structure still does not show any weakness, we would continue with our positive stance and would reiterate index heading towards 11,900 quite soon. Before this, immediate resistances for the forthcoming week can be seen at 11,728 – 11760. On the flip side, this week’s low of 11,639 would now play a major role. Some kind of weakness or extended profit booking can only be witnessed after a breach of this crucial support. Till then one should keep following the positive route map and focus on individual pockets that are providing better trading opportunities.  

As far as sectoral moves are concerned, Pharma and Metal have been the outshining pockets and still, we expect them to do well in coming days. Apart from this, IT stocks gave some sparkling moves on the First and the last day of the week. Do watch out for these spaces along with the midcap universe (especially the cash segment), which is still likely to fetch some decent returns. 

Wockhardt

View – Bullish

Last Close – Rs 663.90

The ‘Pharma’ index has clocked whopping gains over the past three months, but ‘Wockhardt’ remained subdued and has clearly underperformed its larger peers by a fair margin. Now in last three weeks, the stock has made some attempts to show its existence. We can now observe a series of ‘Higher Top Higher Bottom’ formation with ‘RSI-Smoothened’ indicating further strength in prices. Hence, we expect this to have some catch-up rally to its other peers. The potential upside target can be foreseen at Rs 730 and stop loss at Rs 629.

Oriental Bank of Commerce

View – Bullish

Last Close – Rs 84.25

The PSU banking basket has been a big failure and has seen massive wealth destruction for many investors over the past few years. Now, looking at recent development, it appears that the sector is trying to show some revival. How far this would last, the time will tell; but few stocks within this basket are potential candidates to give some relief moves. ‘OBC’ has broken out from the recent congestion zone and has surpassed its hurdle of 81 with some authority. On Friday, there was a pullback towards the breakout point and this dip was immediately bought into. One can look to go long for a positional target of Rs 99 in coming weeks. The stop loss now can be placed at Rs 75.80. 

Disclaimer: The analyst may have positions in any or all the stocks mentioned above.