The Nifty rose 2.4 percent for the week-ended July 27. Experts feel the rally is not over yet and see the index hitting fresh record highs in the August series.
The index finally broke out of the range to hit a fresh record high above 11,171. It closed above 11,200 levels, which has opened target towards 11,350-11,450 levels on the Nifty, technical chartists said.
After the huge rally, the question that most investors are asking is whether the market is overbought now?
Experts feel the momentum has begun and the rally will take the index to fresh record highs before it halts. They advise investors to stay with the trend and not go short at current levels.
“There is still a long way to go, we would rather reframe it as start of the new leg. With Friday’s gap-up opening, we see a breakout from previous highs with a breakaway gap indicating strong optimism to continue,” Sameet Chavan, chief analyst, technicals and derivatives at Angel Broking said.
“Since we have entered uncharted territory; it would be difficult to offer precise levels. We would not be surprised to see the index hastening towards 11,450–11,500 and beyond,” he said.
Chavan sees 11,185 followed by 11,092 as immediate supports. "Any possible decline towards these levels should ideally be used as a buying opportunity."
Here is a list of 10 moneymaking ideas by various experts that could return 5-11 percent in the next 1-2 months: Analyst: Rajesh Palviya, head – technical and derivatives analyst, Axis Securities Motherson Sumi: Buy| CMP: Rs 320| Target: Rs 334-342| Stop Loss: Rs 307| Return 6-9 percent
On the daily chart, the stock is moving in a lower top lower bottom formation. The stock has formed a double bottom formation and has given a neckline breakout at Rs 308 levels.
Volumes are also increasing gradually which signals rising participation in the rally. The stock is well placed above its 100-day SMA which supports bullish sentiments ahead.
The daily strength indicator RSI and MACD both are in a bullish terrain which confirms strength in the near-term.
Century Textiles Ltd: Buy| CMP: Rs 938.65| Target: Rs 980-1000| Stop Loss: Rs 915| Return 5-7 percent
With current week's 7 percent gains, the stock has decisively broken out its nine weeks down sloping channel breakout at Rs 900 levels on the closing basis.
This breakout is accompanied by a rise in volumes which confirms trend reversal on the daily and weekly chart. The weekly strength indicator RSI has given a positive crossover from the oversold region.
GAIL India Ltd: Buy| CMP: Rs 378.65| Target: Rs 393-400| Stop Loss: Rs 366| Return 5-7 percent
With current week's 5 percent gains, the stock has decisively broken its resistance zone of Rs 377 levels on the weekly chart. The stock has also given its six months down sloping channel breakout at Rs 378 levels on the closing basis.
This breakout is accompanied by a rise in volumes which confirms trend reversal on the daily and the weekly chart. Currently, the stock is trading into a rising channel which supports a bullish trend in the short to near-term.
The weekly strength indicator RSI and the MACD both are in bullish terrain which confirms strength in near term.
HDFC Life: Buy| CMP: Rs 507.3| Target: Rs 535-545| Stop Loss: Rs 490| Return 6-8 percent
On the daily chart, the stock has given an ascending triangle breakout at Rs 506 levels. Volumes are also increasing gradually which signals rising participation in the rally.
The stock is well placed above its 20, 50 and 100-day SMA which supports bullish sentiments ahead. The weekly strength indicator RSI and the MACD both are in bullish terrain which confirms strength in near-term.
Analyst: Sameet Chavan, chief analyst, technicals, and derivatives at Angel Broking Arvind: Buy| LTP: Rs. 426.15| Target: Rs 469| Stop Loss: Rs 401.70| Return 10 percent
Last week, the stock prices finally come out of its congestion zone which in technical terms can be interpreted as a breakout from the ‘Triangle’ pattern. This was accompanied by higher than average daily volumes, providing credence to the breakout.
The stock has corrected a bit in the last couple of weeks, but we would rather construe this as a pull back and expect the stock to resume its uptrend. Hence, we recommend buying for an upside target of Rs.469 and stop loss at Rs.401.70.
Century Textiles Ltd: Buy| LTP: Rs 941.95| Target: Rs 998| Stop Loss: Rs 909| Return 6 percent
This stock has undergone massive price correction over the last few months. However, the correction got arrested recently and the stock slipped into consolidation mode.
On Friday, there was a decisive breakout seen from this short-term congestion and hence, we expect the stock to give a decent relief rally in next few days.
The weekly chart displays more strength and hence, one can look to go long for a positional target of Rs.998 in coming weeks. The stop loss needs to be fixed at Rs.909.
Analyst: Dinesh Rohira, founder and chief executive officer, 5nance.com Phillips Carbon Black Ltd: Buy| LTP: Rs 234.85| Target: Rs 260 | Stop-loss: Rs. 220 | Return: 11 percent
After remaining on a sideways direction with negative biasness, Phillips Carbon registered a strong breakout from the crucial level of 20-days EMA placed at Rs 224 on the weekly chart.
Despite coming under pressure on the intraday basis, the scrip decisively managed to rebound at a new level, thus indicating a trend reversal on a short-term basis. The scrip also witnessed a significant volume breakout.
On the weekly price chart, the scrip registered a bullish candlestick pattern indicating a reversal in trend favoring upward momentum.
Further, the weekly RSI at 69 signaled a buying regime at a current level along with positive cues from MACD suggesting an upward shift.
The scrip is currently holding immediate resistance at Rs 291 and immediate support level at Rs 199. We have a BUY recommendation for Phillips Carbon which is currently trading at Rs. 234.80
Biocon Ltd: Buy | LTP: Rs 586| Target: Rs. 620 | Stop-loss: Rs. 553 | Return: 6 percent
Last week Biocon formed a reversal trend favoring upward momentum after consolidating on multiple price level of Rs 674-637 in the last six month.
Although it remained flat during an early trade of the week, it gained strong momentum towards the weekend to close above 200-days EMA levels seen at Rs 560. It also witnessed a substantial support from volume buildup in the same period.
The positive breakout on weekly basis aided the scrip to form a strong bullish candlestick pattern indicating a sustained trend at the current level.
The weekly RSI trend registered an upward momentum at 62 suggesting a buying regime along with MACD trading on a bullish momentum.
The scrip has a support at 521 levels and medium-term resistance level at Rs 637. We have a BUY recommendation for Biocon which is currently trading at Rs. 586.20
Cholamandalam Investment & Finance Co. Ltd: Sell | LTP: Rs 1463| Target: Rs. 1,395 | Stop-loss: Rs. 1,542 | Downside: 5 percent
Cholamandalam Investment mostly traded on a sideways direction favoring the negative biasness on its one-month price chart, and consolidated from Rs 1,608 levels towards a low of Rs 1,446.
Last week the scrip witnessed a setback as it slipped below crucial support of 200-days EMA level placed at Rs 1,476. Further, the volume growth remained to subdue to drop about 5 percent on an intraday basis.
The scrip trend indicated short-term consolidation which is seen with a formation of bearish candlestick pattern on its weekly price chart post-breach below important moving average level.
Further, the secondary momentum trend continued to indicate negative signal with RSI slipping below at 48 coupled with the bearish outlook from MACD trend.
The scrip is facing a resistance at 1600 levels and crucial support at Rs 1,274 levels. We have a SELL recommendation for Cholamandalam Investment which is currently trading at Rs. 1463.35.
Analyst: Mazhar Mohammad, chief strategist – technical research and trading advisory, Chartviewindia.in Federal Bank: Buy| LTP: 90.65| Target: Rs 98| Stop Loss: Rs 84| Return 9 percent
This counter appears to have resumed its uptrend from the 8-day old consolidation phase after the huge single day up move it witnessed on 17th of July.
As the momentum appears to be very strong it should aim at bridging the bearish gap seen in the zone of 98 – 93 registered on 10th of May 2017. Hence, positional traders should buy into this counter for a target of Rs 98 with a stop below Rs 84 on a closing basis.
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