Stock tips from Devang Shah of Sharekhan; Buy RIL, Crompton Greaves

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

NIFTY
CLOSE - 7,601.35 (08.01.2016)

Market closed weekly in negative territory. It witnessed sharp sell off across the board beyond anticipation. It has broken crucial support of 7,714 levels & closed below it at the end of weekly trading session concluding short term trend reversal. All the other indices such as Midcap, Smallcap, Bankex etc closed weekly in negative territory.

It looks like final wave-C of Z beginning for lower levels target in short to medium term. Short term outlook for the market remains negative till Nifty trades below 7,768 levels & expecting targets in the range of 7,450-7,420 levels in short term. Sustain blower it will lead to further sharp sell off till 7,200-7,100 levels in medium term.
 
7,500 & 8,000 are strong supports & resistance levels respectively based on derivative option open interest data so far for this month at current levels of market. One should use any kind of consolidation or pull back rally to exit or sell till short term reverses for trading perspectives.

Momentum indicators daily KST & daily MACD both are in sell supporting short term trend. Close above short term reversal levels will lead to sharp pull back rally till 7,980 levels in short term one should be stock specific & follow the trend with stop loss levels till it reverses.

Stock Picks:

RIL: BUY
Close: Rs 1,026
Target: Rs 1,060

RIL closed weekly in positive territory. It’s out performing in short term. It closed above 20 DMA. Risk reward is favourable to BUY at current levels. One can BUY with a stop loss of Rs 1,000 for the target of Rs 1,060 in short term.

CROMPTON GREAVES: BUY
Close: Rs 193.85
Target: Rs 202/210

CROMPTON GREAVES closed weekly in positive territory. It’s out performing in short term. It closed above 20 DMA. Risk reward is favourable to BUY at current levels. One can BUY with a stop loss of Rs 184 for the target of Rs 202/210 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.

The author is Portfolio Manager- PRO TECH-PMS at Sharekhan