By showing pullback of more than 150 points on Tuesday, Nifty respected the bullish hammer candlestick pattern formed on August 5. Until and unless the low of 10,782, registered on August 5, is breached, traders should remain hopeful for the extension of pullback. Immediate Resistance is seen at 11,080 levels followed by 200-DMA placed at 11,158.
BUY ICICI BANK (Rs 410)
STOP-LOSS: Rs. 398
The stock has partially filled the gap which was formed on May 20, 2019. Gap usually acts as a reversal points and we should not rule out the possibility of pullback in the stock after health correction. Primary trend has been bullish with higher tops and higher bottoms on the weekly and monthly charts.
We recommend buying the stock at CMP, for the target of Rs 425, keeping a stop loss at Rs 398 on closing basis.
BUY PIDILITE INDUSTRIES (Rs 1,309)
TARGET: Rs. 1,370
STOP-LOSS: Rs 1,265
The stock has registered a new all-time high with jump in volumes. Double top resistance of Rs 1,300 is taken out on closing basis. The stock has broken out from five monts' consolidation, indicating fresh momentum in the stock.
We recommend buying the stock at CMP, for the target of Rs 1,370, keeping a stop loss at Rs 1,265 on closing basis.
The author is a research analyst working with HDFC Securities. Views expressed are his own.