Crucial support lies near the line of parity standing near 11,300 marks. Moreover, Flag pattern breakout on the weekly timeframe is valid until it is trading above the crucial support of 11,111.
Nifty faced stiff resistance around 11,800 and traded lower throughout last week and closed near crucial support of 11,300.
Monthly and weekly Heikin-Aashi candles are having bullish formations which imply while a correction is in progress, the bullish trend is still intact.
India VIX traded higher as a sharp fall in the index was seen at the start of the previous week. However, break out of the volatility index will come on a decisive close only above 23 marks.
At the same time, the possibility of cooling off or subdued volatility in the coming session cannot be ruled out, once major events related to the banking sectors are concluded.
Although the benchmark index has managed to close below 20 DMA, all crucial mid-term (50 DMA) and long-term (200 DMA) moving averages are rising and trading higher which indicates bullish bias is still an integral part of the current movement.
Crucial support lies near the line of parity standing near 11,300 marks. Moreover, Flag pattern breakout on the weekly timeframe is valid until it is trading above the crucial support of 11,111.
Here are three buy calls for 3-4 weeks:
The stock, on the weekly chart, has witnessed a rounding bottom breakout and looks positively poised to trade higher.
On the daily chart, the scrip took support from the line of parity and bounced back with marginally higher volumes, which suggest the next upswing in the prices.
The key technical indicators on the near term timeframe are in buy mode. The stock has the potential to continue the current up move and will test higher levels.
Hence, looking at the current structure, we recommend buying in the stock around Rs 104 with a stop loss of Rs 93 on a closing basis for the targets of Rs 125 and Rs 135.
Bharat Forge | Buy | LTP: Rs 489.40 | Target: Rs 580 | Stop loss: Rs 440 | Upside: 19%
The stock is trading with a strong uptrend and rallied from Rs 437 to Rs 500 without any meaningful correction in four months.
For the last few days, the stock has been going through time-wise correction and has formed a falling channel on the daily chart.
Daily 14 period RSI is placed above 60 levels and is gradually turning up, signaling strength in the upside momentum.
In addition, stochastic witnessed a bullish crossover which suggests that bull can continue to gain momentum on the north side.
Hence, looking at the current structure, we recommend buying in the stock around Rs 485 with a stop loss of Rs 440 on a closing basis for the target of Rs 540 and Rs 580.
Bandhan Bank | Buy | LTP: Rs 311.30 | Target price: Rs 360 | Stop loss: Rs 290 | Upside 16%
The scrip spurted from a low of Rs 283 while forming a cup and handle pattern. It showed pullback on the upside, marking the high of Rs 328 and started consolidating there.
Currently, it is waiting for another breakout on the upside so that it can accelerate buying momentum further.
The line of polarity on the daily timeframe chart, standing around Rs 290-300 zone, is suggesting bullish momentum in the scrip.
Indicators and oscillators are also showing favourable scenario in the coming sessions.
Based on these technical structures, one can go long in the scrip around Rs 310 for the target of Rs 350-360, keeping a stop loss of Rs 310.
(The author is Head of Technical Research, Narnolia Financial Advisors)
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