Markets consolidated in narrow range, but witnessed some short covering on Wednesday as Brent crude prices settled around $64 as currency traded positively. Reality, metal, PSU bank sector witnessed buying which led Nifty to close at 10,840.65 adding 23.05 points. Banknifty closed at 27,172.70 gaining 40.95 points.
As per option data for the next week, handful of put writing was seen on lower strikes ranging from 10,650 to 10,800 which will act as support for the weekly expiry. We can witness resistance on higher end at 11,000 and 11,100 as highest OI stand on these strikes. We should keep a positive bias on the Nifty and should keep eye on 10,750 as it will act as major support for Nifty.
Buy Nestle Ltd: above Rs 12,950
Target: Rs 13,650
Stop loss: Rs 12,500
The stock is showing resistance breakout from the levels of 12,950 and as stock is making resistance breakout in daily charts, stock is trading above its 200-day EMA and a breakout is expected to result in a good upside momentum. Considering the technical evidence discussed above, we recommend buying the stock above Rs 12,950 for a target of Rs 13,650, keeping a stop loss at Rs 12,500 on closing basis.
Buy Hindustan Unilever: Rs 1848
Target: Rs 1897
Stop loss: Rs 1812
The stock is trading above all important moving averages. After consolidating in a narrow range, the stock has given a breakout from the resistance of sub 1848 levels and further strength from the levels of 1848 might lead to a bullish movement. We recommend buying the stock at 1848 for the target of Rs 1897, keeping a stop loss at Rs 1812 on closing basis.
Disclaimer: The analyst does not hold position in any of the stocks mentioned above.