Nifty to witness selling pressure in the short-term, says Chandan Taparia

Recommends buying Bharat Financial, selling Punjab National Bank

Nifty outlook and top three trading ideas by Chandan Taparia of MOSL:

Nifty Outlook:
 
Nifty index failed to hold above its crucial hurdle of 9,880 and corrected sharply after breaking its immediate support of 9,775 mark. During the day it fell down towards 9,740 and finally closed the session with the loss of around 83 points. It formed a bearish candle on the daily chart and closed below to its 50 DEMA which has a negative implication if follow up selling continues. It is just few points away from the major support trend line by connecting the lows of 9,088, 9,448, 9,685 and 9,720. If this trend line is broken decisively then short term trend may continue its pace of selling pressure towards 9,600 zones while on the upside resistances are shifting lower to 9,820 and 9,850 marks.

 

Stocks:
 
BHARAT FINANCIAL - BUY
Last Close: Rs 867
Stop Loss: Rs 847
Target: Rs 920
 
It has seen a V shaped recovery in the last week and given a strong breakout on daily, weekly and monthly scale. It formed a positive price pattern and momentum could drive it to hit the 52 weeks high of 920-939 zones.
 
PUNJAB NATIONAL BANK - SELL
Last Close: Rs 138
Stop Loss: Rs 142
Target: Rs 130
 
PSU Banks are underperforming the market and sustained supply is being witnessed at every small bounce back move. A hold below 140 could attract fresh shorts to drag it to lower levels.

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