Nifty could hit 13,150-13,200 in the coming sessions: HDFC Securities

Nifty50 index also remains above the 20-day SMA and has now closed at a new life time high after clearing the recent highs of 12,963

After taking a breather last week on the back of a minor correction, the Nifty resumed its bullish trend this week as it has surged higher to hit new lifetime highs. The Nifty has been continuously moving higher since the last few weeks after finding support at the 50-day SMA.

The 50-share index also remains above the 20-day SMA and has now closed at a new life time high after clearing the recent highs of 12,963. The odds, therefore, suggest that the index could further towards the 13,150-13,200 levels in the coming sessions. Short-term sell offs, however, cannot be ruled out.

We recommend a selective buying approach in outperforming sectors with strict stop losses to control risk. Our bullish bets for the next 7 days will be off if the Nifty dives lower and moves below the recent lows of 12,994. In this scenario, the downside targets would be at 12,910-12,825.

Stock recommendation:
 

Buy: GIC RE

After correcting from a high of 169, touched in July 2020, GIC RE found support around 115 levels in late October 2020. These levels had also acted as a support in May 2020. This week, the stock broke out of the 117-130 trading range on the back of above average volumes. This augurs well for the uptrend to continue.
 

Technical indicators are giving positive signals as the stock trades above the 20-day and 50-day SMA. Intermediate momentum readings like the 14-week RSI, too, are in the rising mode and not overbought.
 

We believe the stock is ready to continue the next leg of its underlying uptrend and has the potential to move higher in the coming weeks. We therefore recommend a 'Buy; between Rs 135-138 levels. CMP is 136.9. Stop loss is at Rs125 while targets are at Rs 164.

Buy HUDCO

   

After correcting from a high of 39.55 touched in August 2020, HUDCO found support around the 30 levels in late September 2020. These level has continued to act as a support in the last few months as the stock consolidated in a range between the 30-34 levels.
 

This week, the stock broke out of the 30-34 trading range on the back of above average volumes. This augurs well for the uptrend to continue. Technical indicators are giving positive signals as the stock trades above the 20-day and 50-day SMA. Momentum readings like the 14-day RSI, too, are in rising mode and not extremely overbought.
 

We believe the stock is ready to continue the next leg of its underlying uptrend and has the potential to move higher in the coming weeks. We therefore recommend a 'Buy' between the 34.5-35.8 levels. CMP is Rs 35.6. Stop loss is at Rs 32.5 while targets are at Rs 43.

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Disclaimer: Subash Gangadharan isTechnical Research Analyst at HDFC securities. He or HDFC Securities Ltd. does not have any financial interest in the subject company. The analyst, currently, doesn't hold any position in the stocks.