Market outlook and top two trading ideas by Prabhudas Lilladher

Nifty outlook and few trading ideas by Vaishali Parekh, research analyst - technical research at Prabhudas Lilladher

MARKET VIEW

After the huge fall a day before Nifty witnessed a choppy session and almost took support near the significant 50-day moving average (DMA) which lies near 11,680 levels but still needs a conviction for further upside movement. However, the support for the day is seen at 38,760/11,620 for Sensex and Nifty, respectively while resistance is seen at 39,330/11,750. Bank Nifty would have a range of 30,050-30,650. Watch for Cement and IT stocks which has been showing signs of a positive bias.

BUY ULTRATECH CEMENT   

CMP: Rs 4,511.45       

TARGET: Rs 4,850      

STOP LOSS: Rs 4,400

The stock has formed a higher bottom formation pattern on the daily chart taking support near the significant 50-DMA which lies near Rs 4,480 levels and has indicated a positive candle to signify strength and has potential to rise further in the coming days. The relative strength index (RSI) has also indicated a trend reversal to signal a buy and to maintain the positive bias. With good volume participation witnessed, we recommend a buy in this stock for an upside target of Rs 4,850 keeping a stop loss of Rs 4,400.

BUY LIC HOUSING FINANCE        

CMP: Rs 539.80      

TARGET: Rs 580     

STOP LOSS: Rs 518

The stock has made a higher bottom formation pattern on the daily chart taking support at the 50-DMA. Currently, it has given a big positive candle to show strength and has made the chart look attractive for further upmove in the coming days. With good volume participation witnessed, we recommend a buy in this stock for an upside target of Rs 580 keeping a stop loss of Rs 518.

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