Nifty outlook & stock calls by Anand Rathi: Buy Lupin, Mahanagar Gas

Lupin's stock is making a higher top and higher bottom pattern on the daily chart

BUY NIFTY | TARGET: 10,450 | STOP LOSS: 10,220

The NIFTY index continued its positive momentum and also reclaimed all its short term moving averages. Now, as long as Nifty trades above 10,040 levels, we can expect the extension of a pullback towards 10,450 levels. Thus, to play this short-covering rally, we advise aggressive traders to initiate a long position with a strict stop loss of 10,220 and defensive traders should refrain from creating any aggressive long bets in the index from here on and adopt a stock-specific approach. 

BUY LUPIN | TARGET: Rs 995 | STOP LOSS: Rs 901

The stock is making a higher top and higher bottom pattern on the daily chart and also trading well above its short term and long term moving averages. The stock has also provided a breakout from a small congestion zone with a higher than average volume. The momentum oscillator MACD has also provided fresh buy crossover on the hourly scale which hints of positive momentum to continue in the short term.

BUY BEML | TARGET: Rs 710 | STOP LOSS: Rs 630

The stock has provided breakout from two-month consolidation and it is also respecting its 21-DMA. The volume activity has started from the past couple of sessions. The stock has also completed its 38.2 per cent retracement of the entire fall and its heading towards 50 per cent levels which is placed at 710 levels. 

SELL MGL | TARGET: 1,000 | STOPLOSS: 1,090

The stock is facing stiff resistance at around 1,100 levels and also forming an evening star candlestick formation which is considered as a bearish reversal pattern. The momentum indicator RSI is has reached the overbought territory of 70 and started moving downside. Thus, based on the above rationale, we are getting early signs of a potential trend reversal.
Disclaimer: Nilesh Jain is Technical and Derivatives Research - Equity Research Analyst at Anand Rathi Shares and Stock Brokers. He may have positions in one or more stocks. Views are his own.