Trade Spotlight: Britannia, Oberoi Realty and HCL Technologies are in focus

Indian market rallied for the third consecutive day in a row on October 20 following a positive trend in global markets. The S&P BSE Sensex rallied by more than 100 points while the Nifty50 closed just a shade below 11,900 levels.

Let’s look at the final tally on D-Street – the S&P BSE Sensex rose 112 points to 40,544 while the Nifty50 gained 23 points to close at 11,896.

Stocks like Britannia Industries which fell nearly 6 percent, Oberoi Realty was up nearly 20 percent, and HCL Technologies closed with gains of more than 4 percent on Tuesday were some of the stocks in focus.

We have collated views of experts on what investors should do when the market resumes trading on Wednesday, 21 October:

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

Britannia Industries: Fresh buying should be avoided

This counter appears to be in a multi-month consolidation phase after registering a life time highs of 4010 last July. In the last trading session, it appears to have registered a consolidation breakdown from the minor congestion zone of 3800 – 3700 in which it traded for 5 sessions.

However, major correction can be expected in this counter if it closes below 3540 levels and in such a scenario it can head all the way down to test its 200-Day simple moving average (SMA) whose value is placed around 3346 levels.

Fresh buying should be avoided unless it undergoes a multi-day consolidation. If someone stuck up in this counter and looking to exit they are advised to maintain a stop below 3540 levels.

In case if it stabilises above 3540 then it should see a tepid bounce towards 3640 which can be an opportunity.

Oberoi Reality:  Initial target can be close to Rs 500

This counter appears to have registered a fresh breakout from its multi-week consolidation zone of 440 – 366 levels. As this breakout is occurring after a struggle of 7-weeks a sustainable up move can be expected as long as it sustains above 440 levels.

In such a scenario initial target can be close to 500 levels and beyond that, a bigger target of 540 can’t be ruled out.

Positional traders are advised to hold for a target of 497 whereas fresh buying can be considered on correction around 450 levels with a stop below 440 on a closing basis.

HCL Technologies: Booking profits by making use of the rally

It will be too early to conclude that this counter initiated a fresh leg of an upswing after a three-day-old correction from the highs of 910 – 820 levels.

If we closely observe the last 5 weeks of candles then the medium-term momentum appears to be fading as this counter failed to add meaningful net gains in the preceding 4 weeks.

Hence, the current spurt may also witness profit booking sooner than later. Therefore, traders will be better off booking profits by making use of this rally.

However, fresh buying can be considered on a close above 912. In that scenario, a bigger target of 970 can be expected.