Technical picks from Motilal Oswal: Buy TCS, Bosch; Sell M&M

Here are a few Nifty stocks recommended from Motilal Oswal Securities

Nifty Outlook

As per Dual distribution theory, Nifty is now approaching the resistance area with the RSI inching towards 65. Diminishing momentum & proximal resistance at 8450 remains a concern; however we are yet to witness any sign of reversal on the absolute scale. Hence participating in the up move with a trail stop strategy at 8180 would be prudent.

 

TCS: BUY

Target : Rs 2,750

Stop Loss: 2,480

 

TCS has been oscillating within the intermediate range of Rs 2750-2450. The recent correction saw the stock stabilizing near the lower end of the range. The occurrence of a ‘Bullish Harami’ at the support indicates the oscillation to continue. TCS could be bought with stop at Rs 2480 for a target upto Rs 2750

 

BOSCH: BUY

Target : Rs 24,000

Stop Loss: Rs 20,200

 

Reversal from the lower end of the oscillating band; followed by a continuation pattern on the immediate scale confirms strength in the up move. The setup provides a good reward to risk opportunity .Bosch could be accumulated with a stop at Rs 20200 for a target upto Rs 24000 (Higher end of the band).

 

MAHINDRA & MAHINDRA: SELL

Target : Rs 1,140

Stop Loss: Rs 1,298
 

Post the pullback M&M saw a stiff resistance near 1290-1300 (61.8% Retracement of its prior move). The week gone has formed a 'Bearish Engulfing' indicating fresh weakness. Pullback if any up to Rs 1270 could be utilized to create fresh short positions with a stop above Rs 1298 for a target up to Rs 1140.

 
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Shubham Agarwal is a head of Quantitative Research, Motilal Oswal Securities