Nifty outlook and top trading ideas by HDFC Securities for today

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

Nifty near 10100 support

Nifty has formed Doji pattern yesterday which Indicates indecision between bulls and bears and considered as a sign of possible reversal of price direction. For confirmation of the pattern, Nifty should close above Monday’s high i.e. 10,250 level. RSI oscillator on the Nifty has also confirmed the positive divergence yesterday on the daily charts, where the price has made new low and oscillator formed a higher low. This setup indicates that bears seem to have lost the dominance gradually and there could be a chance of trend reversal for short term.

Though Primary trend of the Nifty had been bearish with lower tops and lower bottoms on the daily charts, considering the technical evidence discussed above, we believe that we may see pullback rally from here.

Therefore our advice would be to cover short and accumulate long positions with the stop loss of 10,050 levels. On the higher side, any close above 10,250 levels would result in the further short covering which might push Nifty to even 10,400 levels.

Stock calls

BUY BEL 

CMP: Rs 87 

Target: Rs 95 

Stop loss: Rs 82

After a sharp price correction till the month of September, accumulation is visible in the month of October, where the stock price rose more than 15% from the September low with a rise in volumes. Stock has given the breakout on the daily chart yesterday by closing above its 5 day simple moving average with higher volumes. Momentum Indicators and Oscillators are indicating strength in the stock for the short to medium term.

We recommend Buying BEL for the upside target of 95, keeping SL at 82.

Buy HPCL 

CMP: Rs 218 

Target: Rs 236 

Stop loss: Rs 205

Stock price has broken out on the daily chart yesterday by closing above the resistance level of 215. Stock has also managed to close above 5 day SMA yesterday with higher volumes. Momentum Indicators and Oscillators like RSI  and MACD have turned bullish on the daily charts. Fall in crude prices during last few days also augurs well for the HPCL as well other OIL marketing companies.

We recommend buying HPCL for the upside target of 236, keeping SL at 205.

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