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Nifty outlook and top stock picks by Motilal Oswal Securities

Nifty outlook and top stock picks by Chandan Taparia, Derivatives & Technical Analyst, MOSL.

Chandan Taparia  |  Mumbai 

Equity fund managers, Stock markets, Indian stocks

outlook and from Chandan Taparia, Derivatives & Technical Analyst, Motilal Oswal Securities:

Outlook :
.

index traded in a range of 50 - 60 points throughout the session and closed near to its 50 DEMA. It managed to close positive after the decline of last five trading sessions and formed a small Bullish candle on the daily scale. However it continued its formation of lower highs – lower lows for last five trading sessions and needs to negate the same to get a short term stability. Now it has to hold above 10550 zones to witness an up move towards 10625 then 10650 levels while on the downside 10480 then 10440 are likely to act as a key support zones.
.

Stocks:

SRTRANSFIN
Reco: BUY
Last Close: 1453
Stop Loss : 1413
Target : 1530
.

Trading in rising upward channel, it has given bounce back after retesting of previous trend line breakout. Mechanical indicator given positive crossover.

PIDILITE
Reco: BUY
Last Close: 1118
Stop Loss : 1092
Target : 1055
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It is on the verge of pole & flag breakout. RSI witnessed positive crossover with rise in volume.

TATA ELXSI
Reco: BUY
Last Close: 1169.45
Stop Loss : 1135
Target : 1240
.

On the verge to triangle breakout It is on the verge of pole & flag breakout. RSI moving north ways in all timeframe.
.

STRATEGY

TECHM – BULL CALL SPREAD +690 CE -710 CE
BUY TECHM 1 LOT OF 690 CALL @ 19.50
SELL TECHM 1 LOT OF 710 CALL @ 13.50
NET PREMIUM PAID : 6
KEEP SL OF NET PREMIUM OF 2 POINTS (RISK : Rs. 4800/-)
KEEP TGT OF NET PREMIUM OF 13 POINTS (REWARD : Rs. 8400/-)
.

.

Rationale:
1. The stock is making higher top- higher bottom formation on daily scale
2. Maximum Put OI is at 670 Strike which is acting as a strong support
3. Call unwinding is seen at 700 strike which could provide scope for further up move
4. Thus, suggesting Bull Call Spread to play the positive to range bound move

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

First Published: Wed, May 23 2018. 07:07 IST
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