Pullback Likely to extend up to 10300 in Nifty: HDFC Securities

Nifty outlook and top stock picks by Vinay Rajani, Technical Analyst, HDFC Securities:
 
Nifty Outlook
 
Nifty has witnessed a fall of almost 11% from the all-time high of 11171 registered in Jan 2018 to the recent bottom of 9951. Nifty Midcap and Smallcap indices plunged 16% and 21% respectively. Many stocks have seen a fall of than 40% from their 3 Month’s high.  Due to this panic selling, stocks have turned extremely oversold on the daily and weekly chart. As a result of the same we saw Markets started rebounding from last two sessions.   
 

Nifty has reclaimed a level above its 200 DMA resistance. However, it is yet to surpass the crucial resistance of 10227, the previous top on the daily charts. RSI oscillator has formed positive divergence, indicating probability of the pullback. We expect Nifty to extend the recent pullback up to 10300. The level of 9950 seems to be a short term bottom for Nifty and should be kept as a stoploss in trading longs.

 
MANAPPURAM FINANCE (110): BUY| Target Rs. 118 | Stop-loss Rs 105
 
Stock has been hovering around its 200 DMA support, which is currently placed at 104 odd levels. Stock has recently surpassed the crucial resistance of 50 days EMA, placed at 108 levels. For last two days volumes remained high along with the price rise. Oscillators like RSI and MACD have been showing strength on the daily and weekly charts. Prospects of the stock looks very good going ahead. Short term moving averages have been trading above long term moving averages.  We recommend buying Manappuram Finance for the upside target of 118, keeping SL at 105.

 
TV18 BROADCAST (68.50): BUY| Target Rs. 74 | Stop-loss Rs 65.5
 
Stock has been resilient and hovering around its 52 week high of 69.45. Yesterday, Stock resumed its uptrend after small correction, witnessed during last week. Price has recovered sharply, with jump in volumes, yesterday. Stock found support on its 20 days EMA and reversed northward recently. Media sector has been performing well from last couple of weeks and the same is likely to continue. Primary trend of the stock has been bullish with higher tops and higher bottoms on the weekly charts. We recommend buying TV18 for the upside target of 74, keeping SL at 65.5