The market started the week higher on the back of positive global cues. Throughout the session, the Nifty remained more or less sideways before closing 58.60 points higher on Wednesday.
On the lower end, previous session high acted as the support for the index, whereas on the higher end, the Nifty approached 11,000 mark during the session. The daily momentum indicator, RSI (14) is in bullish crossover and rising with a current reading of 61.90.
On the options front, maximum open interest position is visible in 11,000 CE (39.61 Lakh shares) and 10,000 PE (47.23 Lakh shares); whereas, notable open interest seen in 10800 PE (43.64 Lakh shares).
Going forward, the market may witness some volatility as the barometer index Nifty approaches towards the resistance zone which is currently placed at 11,000-11,100.
A decisive takeout of the said resistance zone is likely to induce a further rally towards 11,300. On the other hand, failure to absorb selling pressure at 11,000-11,100 zone may lead to a correction towards 10,700.
Here is a list of three stocks which could give 5-10% return in the next 1 month:
Eicher Motors: Buy| LTP: Rs 23,955.70 | Target: Rs 25,200| Stop Loss: Rs 23,290| Return 5%
The stock has seen to have found support at the rising trend line on the weekly chart; also, the correction halt at the support line was followed price appreciation in quick sessions suggesting the strength of the support line.
In addition, a bullish engulfing pattern is visible on the weekly chart. The price has moved above the 50-EMA on the daily chart. Recently, the price has moved above the 50% retracement of the previous fall from 25350 to recent low 21800.
Traders can accumulate the stock in the range of 23900–24000 for the target of 25200 and a stop loss below 23290.
Dixon Technologies: Buy| LTP: Rs 2,121.65 | Target: Rs 2,340 | Stop Loss: Rs 2,037| Return 10%
On the daily chart, the stock has given a breakout above the falling trend line which suggests a reversal in the trend. On the weekly chart, the stock formed a ‘Morning Star’ kind of candlestick pattern which suggests a possibility of a larger bullish reversal in the stock.
In addition, the daily RSI is in a bullish divergence with the price which suggests momentum is likely to change to positive. Traders can accumulate the stock in the range of 2115-2130 for the target of 2340 and a stop loss below 2037.
JSW Steel: Buy| LTP: Rs. 311| Target Rs 336| Stop Loss: Rs.298| Return 8%
The stock has given a falling wedge breakout on the daily frame. In addition, for an early indication, we find a higher bottom on the daily chart.
On the weekly chart, a ‘Morning Doji Star’ formation is visible which suggests a strong reversal on the bullish side. The daily strength indicator, RSI (14) has come out from the oversold zone after a prolonged stay.
Traders can accumulate the stock in the range of 308-313 for the target of 336 and a stop loss below 298.
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Source: Moneycontrol
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