Hold Nifty longs for target of 10,700-10,750: HDFC Securities

Technical calls and Nifty outlook by Devarsh Vakil & Vinay Rajani - PCG Desk, HDFC Securities:
 
Nifty Outlook
 
Yesterday, Nifty failed to surpass the previous top resistance of 10638, to close at 10554. Yesterday’s fall from the higher levels seems like a regular profit booking, which does not violate the probability of extending the pullback in the Nifty towards the next target of 10700-10750.  Last week, Nifty formed bullish candlestick pattern known as “Dragonfly Doji” on the weekly charts. This pattern signals indecision among traders. It's formed when the security's high, open, and close prices are the same. The long lower shadow suggests that the forces of supply and demand are nearing a balance and that the direction of the trend may be nearing a major turning point. There is strong support at 10500 levels, around which Nifty should be bought into, with the stop loss of 10450. 

 

BUY:  HCL Info
CMP: Rs 64.05
Stop Loss: Rs 61
Target: Rs 69
 
Stock is on the verge of giving highest monthly close since Nov 2015. Stock price has given Ascending triangle breakout on the monthly chart by closing above 54 level indicating primary uptrend. Stock price is trading above its 20, 50, 100 and 200 DMA, which indicates bullish setup for medium to long term. Oscillators and momentum Indicators showing strength on the medium or long term chart.  Recent price fall of 10% seems to be a running correction in overall bullish trend. Considering the technical evidences discussed above, we recommend selling the stock between 64 and 62, for the target of 69, keeping a stop loss at 60 on closing basis.

 
BUY:  Interglobe Aviation
CMP: Rs 1337.5
Stop loss: Rs 1290
Target: Rs 1425
 
Stock price has broken out from Long-term trend line with significant jump in volumes. It has been forming higher tops and higher bottoms on the weekly and monthly charts. Stock is seems to have broken out from the last 6 month price consolidation. Oscillators like ADX and MACD have been showing strength on the daily and weekly charts. Considering the technical evidences discussed above, we recommend selling the stock between 1338 and 1305, for the target of 1425, keeping a stop loss at 1290 on closing basis. 

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