Trade Spotlight: UltraTech Cement, Infosys, HCL Tech, MCX & Kotak Bank in focus

Indian market snapped two-day losing streak on July 28 as bulls pushed the S&P BSE Sensex higher by over 500 points while Nifty50 reclaimed 11,300 levels.

The momentum is likely to remain strong on July 29. The Nifty50 recorded a breakout on Tuesday, and the first resistance will be seen around 11,350-11,400 levels.

Stocks like UltraTech Cement, Infosys, HCL Technologies, MCX, and Kotak Mahindra Bank remained in focus on Tuesday.

We have collated views of experts on what investors should do when the market resumes trading on Wednesday, 29 July:

Expert: Mazhar Mohammad, Chief Strategist – Technical Research & Trading Advisory, Chartviewindia.in

Ultratech Cement: Adopt a two-pronged strategy of buying now, & on dips

This counter appears to have registered a consolidation breakout after moving in a sideways zone of 3955 – 3735 levels for a period of 41-sessions.

As this breakout is on the back of relatively much higher volumes, one can safely presume that this counter has embarked on a near-term uptrend with initial targets of 4385 levels.

However, on sustaining above 4400 for a couple of sessions on a closing basis then a bigger target of 4750 can’t be ruled out.

Considering the large move witnessed in the last trading session, positional traders are advised to adopt a two-pronged strategy of buying now and adding further on a dip in the zone of 4000 – 3900 levels. A stop advised for the trade is close below 3850.

Infosys: Buy on correction in the zone of Rs 900 – 850

New lifetime highs are always a sign of strength for any counter hinting that trends across the time frames are bullishly poised. However, a close look at the last 9 sessions of price behaviour is hinting that this counter might have slipped into sideways consolidation between 955 – 892 levels.

Hence, from a risk management perspective traders will be better off by locking their profits in the next session if it fails to register a strong close above 960 levels.

In case if it manages a close above 960 then based on long term channel studies a modest target of 1050 can be projected.

However, if it trades below 940 then eventually it should retest the lower end of the consolidation zone present around 900. It can be an attractive buy on correction in the zone of 900 – 850 with a stop below 848 on a closing basis.

HCL Technologies: Fresh buying should be preferred only on correction towards Rs 650

Despite new lifetime highs price action of the last session appears to be hinting at weakening momentum after the rally from the lows of 640 in just 3 trading sessions.

Hence, in the next trading session, unless it registers a strong close above 715 levels profit booking is advisable, for the short term traders, though weakness will be confirmed on a close below 695 levels.

Hence, as long as it sustains above 695, the trend can be sideways with a positive bias and in that scenario eventually, a higher target of 780 can be expected.

Fresh buying should be preferred only on correction towards 650 with a stop below 640 on a closing basis.

Kotak Mahindra Bank: Traders will be better off by avoiding this counter

Despite a strong show in the last trading session the larger trend seems to be that of sideways in nature. Weakness can be expected on a close below 1319 whereas short term breakout above 1400 on closing basis shall warrant a fresh buying.

On such a breakout above 1400, it can head test its 200-Day moving average present around 1473. For the time being, traders will be better off by avoiding this counter.

MCX: Buy| Target Rs 1970| Stop Loss Rs 1690

This counter appears to have registered a fresh breakout above its 59-Day ascending channel before hitting the new lifetime highs in the last trading session.

Based on this channel, higher targets of 1970 can be projected, though this counter is trading in uncharted territories.

Technically speaking, the near-term trend in this counter shall remain intact unless it closes below 1445 levels which from current levels looks slightly far away.

Therefore, from a risk management perspective, investors who already own this counter or want to initiate fresh buy shall maintain a stop below 1690 on a closing basis and look for a bigger target of 1970.

This counter can become an attractive buy on correction into the zone of 1500 – 1450 levels with a stop below 1445 on a closing basis.