Podcast | Stock picks of the day: Top 3 stocks which could give 6-11% return in next 1 month

IIFL

The market continued to tumble severely in the second week of October to extend its losing streak for the sixth consecutive week.

Global turmoil and depreciation in rupee (hitting an all-time low of 74.48 against the US dollar) are among the major factors that are taking a toll on sentiment.

Even cooling off in crude oil prices have failed to prop up the mood on Dalal Street. Volatility has spiked significantly as wild swings have caught traders on the wrong foot.

Thursday’s fall has triggered a fresh inverse Flag pattern breakdown on the daily chart which indicates further downside cannot be ruled out.

The only saving grace is 10,200 rising trendline support zone on the weekly chart which the Nifty has just managed to hold above. A crack below the same on a closing basis would further accentuate selling pressure.

Bank Nifty, on the other hand, is indicating weakness on the downside, 24,200 is going to act as crucial support while on the upside 25400 is the important resistance.

Following is a list of stocks that could deliver up to 6-11% returns

Pfizer: Buy| Target: Rs 2,980| Stop Loss: Rs 2680| Returns 7.1%

The stock has been under pressure since hitting its all-time high of 3847 on August 28, 2018. However, for the first time, the stock has managed to stage a solid come back which has aided Pfizer to break out from a falling channel pattern on the daily chart.

The stock has also found support at its long-term 200-DEMA of Rs 2580 and bounced back. The stock has also reversed from the 61.8% retracement zone of Rs 2508 which further accentuates our bullish stance on the stock.

Dhampur Sugar: Buy| Target: Rs 171| Stop Loss: Rs 145.5| Returns 11%

The stock has been going through an impressive phase of accumulation since April 2018. After consolidation for over five months, the stock has finally broken out from a Rounding Bottom pattern on the daily chart.

The price outburst has been accompanied with a smart uptick in traded volumes. We expect the stock to rally towards its potential target of Rs 171 in the medium term.

Jindal Steel & Power: Sell Oct Futs| Target: Rs 155| Stop Loss: Rs 171| Returns 6.6%

The stock has broken down from an inverse Cup and Handle pattern on the weekly chart and has also sustained below the breakdown zone. Jindal Steel has also entered into a lower top lower bottom structure which is a negative development.

The stock has also broken down from an inverse Flag pattern on the daily chart which further accentuates our bearish stance on the stock.