Nifty outlook and top trading ideas by HDFC Securities

Nifty outlook and top trading ideas by Vinay Rajani, Technical Analyst, HDFC Securities:

Nifty breaks the 5 session’s losing streak by rising 20 points, to close at 10536. Midcaps and smallcaps have been hammered down significantly recently.  We are in fag end of the result season and considering the oversold conditions, we expect midcaps to recoup some of their losses in the coming days. However, considering the overall trend, Nifty should be sold in the pullbacks. Range of 10600-10650 should be utilized to initiate fresh shorts with a stop loss of 10700. Support for the Nifty is seen at 10325.

BUY TATA SPONGE

CMP: Rs 1,069

Stop Loss: Rs 1,045

Target: Rs 1,110

Stock price has formed bullish engulfing pattern on the daily charts, indicating short term bullish trend reversal. Stock has been an outperformer in recent bearish phase of the midcap index. Company posted strong quarterly numbers recently. Stock has seen a healthy correction of 17% from the April 2018 High. Volumes during price fall were low and remained high at the time of price rise.

We recommend buying Tata sponge for the upside target of 1110, keeping SL at 1045.

BUY KEI INDUSTRIES

CMP: Rs 458

Stop Loss: Rs 439

Target: Rs 490

Primary trend of the stock has been bullish with higher tops and higher bottoms. Stock is hovering around its 52 week and all time highs. Price is trading above all important moving averages, which indicates uptrend on all time frames. Volumes have gone up nicely in the recently along with the price rise. Oscillators like MACD, RSI and DMI have been showing strength in the existing bullish strength.

We recommend buying KEI Industries for the upside target of 490, keeping SL at 439.

Disclaimer: The analyst may have positions in any or all the stocks mentioned above.