Nifty Outlook and top trading ideas by HDFC securities for today

Nifty outlook and technical calls by Nandish Shah, Technical & Derivatives Analyst, HDFC Securities:

REMAIN LONG IN NIFTY WITH SL OF 10700. TARGET 10950

While the Nifty closed just 5 points down at 10,802, the gloom was high as the BJP gave up its intraday majority mark with just 104 leads at the time of market close. The PSU bank index and the real estate index were the worst decliners.

Though the BJP dramatically improved its performance from the last elections, reports that the Congress was ready to provide support to the JDS, the indices slipped.

It’s an event that is now out of the way. The markets will now be more reactive to the international cues.

Nifty Midcap and Smallcap indices have been significantly underperforming the Benchmark indices and due to that breadth of the overall market have been weak for last two weeks.

In the derivatives, we have seen long positions being built in the Nifty and Bank Nifty Futures’ during last few days. Moreover FIIs’ also created long positions in the Index & Stock Futures’ during the last week. Amongst the Options, Puts have been written at 10700-10800 level.

Buy MAHINDRA LIFESPACE DEVELOPERS

CMP: Rs 523

Stop Loss: Rs 485

TARGET: Rs 570

Stock price has given breakout on the daily chart last Friday, Where It closed above the crucial resistance level of 485. Short term moving averages are trading above long term moving averages, Indicating strength in the stock for the short to medium term. Trend of last few days, Where Price is rising with higher volumes and subdued volumes during the consolidation, indicates strength in the uptrend. Momentum Indicators and Oscillators like RSI and MACD are showing strength in the Stock for the short to medium term.  Therefore, We recommend buying Mahindra LifeSpace for the upside target of 570, keeping SL at 485.

BUY EDELWEISS FINANCIAL SERVICES

CMP: Rs 299

Stop Loss: Rs 285

Target: Rs 325

Edelweiss Financial Services has given bullish trendline breakout on the daily chart yesterday by closing above the downdard slopping trendline, adjoining the highs of 03-November-2017 and 03-May-2018. It has already given breakout on the daily line chart by closing above multiple resistance level of 297 with higher volumes. Stock is trading above its 5, 20,200 day simple moving averages, Indicating Stock price is in uptrend for the short term and long term charts. Momentum Indicators and Oscillators like RSI and MACD are showing strength in the Stock for the short to medium term. Therefore We recommend buying Edelweiss Financial for the upside target of 325, keeping SL at 285.

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