Buy IOC, Vedanta, Hindalco: Devang Shah of Sharekhan

Here is a list of top three trading ideas and strategies from Devang Shah of Sharekhan for the coming week

NIFTY
CLOSE- 8541.40 (15.07.2016)

Market closed weekly in positive territory. It has achieved my short term targets levels near recent high as expected last week. It made a high of 8571.40 levels. All the other Indices such as BANKEX, MIDCAP & SMAL L CAP etc closed weekly in Positive territory. After achieving short term targets levels, we got profit booking from higher levels & market closed marginally in negative territory at the end of weekly trading session.

Short term out look for the market still remains positive till nifty trades above 8287 levels & expecting it to trend towards my first medium term targets of 8650 levels as anticipated earlier. Its important levels to watch out for, sustain above it will further confirm rally towards higher levels targets till 8850-9120 levels in medium term.

BANK NIFTY has also achieved my short to medium term targets levels near recent high as expected earlier. It made a high of 19,045.20levels today. It has strong support near 18193 levels in short term, till it holds one can expect further higher levels targets till 19300 levels in short term. 16,900 is strong support & reversal levels for medium term perspectives for BANK NIFTY.

Broader market is also outperforming at current levels of market. BSE MIDCAP made all time high in recent rally, its very good sign for overall trend of the market.

From overall wave count perspectives, its missing wave-V or larger wave-III is still not conclusive as per quarterly chart attached of sensex & Nifty but both indicating bullish trend. In that case NEW ALL TIME HIGH POSSIBLITY also can’t rule out as per chart attached. Therefore, it’s advisable to Trail this party till medium term reverses from investment perspectives, Will review market behaviour at every higher resistance levels to get more confirmation on the same.

8400 & 8700 levels looks strong support & resistance levels respectively as of now based on derivative option open interest data for this month.

Momentum indicators Daily KST & Daily MACD both are in BUY supporting UP trend. One can’t rule out profit booking from current levels. One should be stock specific in any kind of correction or consolation in the market till short term reverses. Close below short term reversal levels will lead to sharp correction till 8200-8170 levels in short term.  

Stock Picks:

IOC- BUY
CLOSE-477.90
TGT-505

IOC closed weekly in Positive territory. It’s out performing in short term. Its daily momentum indicators are in BUY. Risk reward is favourable to BUY at current levels. It has wave-V up pending on daily chart. One can BUY with SL-450 for the target of 505 levels in short term.

VEDANTA- BUY
CLOSE-163.25
TGT-173/182

VEDL closed weekly in Positive territory. It’s outperforming in short term. Its daily momentum indicators are in BUY. Risk reward is favourable to BUY at current levels. One can BUY with      SL-149 for the targets of 173/182 levels in short term.

HINDALCO- BUY
CLOSE-137.15
TGT-145/150

HINDALCO closed weekly in positive territory. It’s out performing in short term. Its daily momentum indicators are in BUY. Risk reward is favourable to BUY at current levels. One can BUY with     SL-130 for the target of 145/150 levels in short term.


The author is Portfolio Manager- PRO TECH-PMS at Sharekhan

Disclaimer: The analyst may have a position in the scrip mentioned above; the views given above are the personal views of the analyst.