Stock tips from Devang Shah of Sharekhan; Buy HPCL, BPCL, Coal India

Here is a list of top three trading ideas and strategies from Devang Shah of Sharekhan for the coming week:

NIFTY
CLOSE- 8295.45 (22.10.2015)

Nifty closed 4th consecutive week in positive territory. Market is clearly showing TIME WISE Extension at current levels of this pull back rally. It’s traded in very thin range of 100 points on nifty with lost of momentum during entire week. It made a high of 8328.10 levels on nifty & 27,555.03 levels on sensex today. It’s closed around very crucial resistance levels, near short term targets levels as mentioned below at the end of trading session.
 

All the other indices closed weekly in positive territory. It looks like wedge kind of pattern as per hourly charts of Nifty. Break of lower end of support/reversal levels will finally confirm short term trend reversal. One should closely watch out market behaviour around these levels.

Short term outlook for the market remains positive till nifty trades above 8217 levels & expecting target around 8360 levels. Medium term outlook for the market still remains negative till nifty trades below 8655 levels & expecting targets in the range of 7539-7420 levels in medium term. One should be cautiously Bullish at such crucial levels of market for short term.

CNX BANKEX is also trading in range of 17500-18000 levels. It’s also showing wedge kind of pattern. It’s also closed near upper end of range Sustain above 18000-18100 levels will only confirm further trend till 18500 levels in short term.

Midcap & Small cap indices started to show negative divergence today. NIFTY MIDCAP & BSE SMALL CAP Index is showing 5 wave declines on hourly charts & BSE MIDCAP Index is showing Expanding Triangle kind of pattern on hourly charts. These indices are showing weakness & TOP Formulation kind of pattern at the end of trading session. It can be taken as warning sign ahead of main index reversal. One should watch out these indices behaviour in coming trading session to take further clue for short term trend.

Market will remain volatile ahead of an expiry next week. Market is having support at lower levels of 8200/8100 levels & it having strong resistance around 8300-8400 levels based on option interest data for this month. It indicates possibility of market may spent further some more time between 8100-8400 levels in this TIME WISE EXTENDING Pull back rally.

Momentum indicators daily KST & daily MACD both are in BUY supporting short term trend. Sustain below short term reversal levels will lead to sharp fall till 8090-8000 levels in short term. One should be stock specific & keep profit booking at regular intervals, as we are at very crucial levels of market & follow the trend with trail stop loss levels till it reverses.

Stock Picks:

HPCL- BUY
CMP- Rs 798
TARGET- Rs 830/849

HPCL closed weekly in positive territory. Its Daily momentum indicators are in SELL. Risk reward is favourable to BUY at current levels. It can further extend for wave-C up in this pull back rally. One can BUY with a stop loss of Rs 780 for the target of Rs 849 levels in short term.

BPCL- BUY
CMP- Rs 908
TARGET- Rs 925

BPCL closed weekly in Positive territory. Its Daily momentum indicators are in BUY. Risk reward is favourable to BUY at current levels. It can further extend in this pull back rally. One can BUY with a stop loss of Rs 897 for the target of Rs 925 levels in short term.

COAL INDIA- BUY
CMP- Rs 341
TARGET- Rs 353

COAL INDIA closed weekly in positive territory. Its Daily momentum indicators are in BUY. Risk reward is favourable to BUY at current levels. It can further extend in this pull back rally. One can BUY with a stop loss of Rs 337 for the target of Rs 353 levels in short term.

Disclaimer: The analyst may have a position in the scrip mentioned above; the views given above are the personal views of the analyst.

Devang Shah is a Portfolio Manager- PRO TECH-PMS at Sharekhan