2 stocks ideas by Osho Krishan of Anand Rathi: HDFC Life, Cummins India

BUY HDFC LIFE INSURANCE COMPANY LTD | TARGET: 760 | STOP LOSS: 670

HDFC LIFE has corrected nearly 10 per cent from its all-time high and eventually retraced over 50 per cent on the Fibonacci retracement of the recent rally. In the last trading day, the stock has witnessed some buying interest near the 200 DEMA on the daily chart that historically has been a strong support zone for the counter. On the oscillator front, 14 period RSI is also placed to its historical support zone and with a reversal sign in the last session, it is indicating an increase in demand at lower levels. Hence, the early sign of reversal could be utilised by the bulls to maximize gains from the counter.

BUY CUMMINS INDIA | TARGET: 980 | STOP LOSS: 860

CUMMINS INDIA is trading in a rising channel and is currently placed near the lower band of the channel signalling a near-term resurgence. In the last trading week, the stock has formed a bullish reversal pattern post four consecutive weeks of corrections, suggesting the initial sign of reversal in the stock. Also looking at the trend, the lower Bollinger band has historically proved to be a strong demand zone and the same could be expected in the near term. Even the placement of the stock price is at lucrative levels from a risk-reward point of view and holds strong upside potential in the short term time frame.

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Discalimer: Osho Krishan is Senior Manager – Equity Research at Anand Rathi Shares & Stock Brokers. Views expressed are personal.