Stock Picks of the Day: Support for Nifty now shifts to 10,780-10,675

Continue with a stock-specific trading approach in the meanwhile and maintaining positions on both sides. Also, keeping close watch on earnings announcements and global markets for cues.

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Markets consolidated for yet another week but somehow managed to gain over a percent. Weak IIP data and not so encouraging global cues led feeble start, however, it rebounded sharply in the following session, thanks to easing retail inflation and rebound in global indices.

The market has been hovering in a range for nearly three months and we expect this phase to end soon. As quoted in our previous posts, a decisive breakout above 10,950 in Nifty would push the index towards 11,100 and indications are strongly in favour of a breakout this time.

On the downside, the support has now shifted towards 10,780-10,675 zone. We advise participants to continue with a stock-specific trading approach in the meanwhile, and to maintain positions on both sides. Also, keep a close watch on earnings announcements and global markets for cues.

Here is a list of top three stocks which could give 4-6% return in 1 month:

Dabur India: Buy| Target: Rs 445| Stop loss: Rs 414| Return 4.7 %

After a swift rebound from Rs 362 to Rs 458 levels, Dabur has retraced of late and formed a strong base around the support zone of multiple moving averages i.e.( 100/50) day EMA on the daily chart.

We believe that it is a healthy retracement after the strong surge and now it looks all set to resume the uptrend. We advise initiating fresh long positions within Rs 420-425 range. It closed at Rs 428.15 on January 21, 2019.

ITC: Buy | Target: Rs 302| Stop loss: Rs 284| Return 4.1 %

In line with majority FMCG majors, ITC is trading strong. It has retraced marginally of late and reached closer towards its immediate support zone placed around 290 levels. Considering the current market scenario, it’s advisable to prefer defensive stocks for buying.

Traders can initiate fresh longs as per the mentioned zone Rs 287-290. It closed at Rs 289.90 on January 21, 2019.

Siemens: Sell January Futures |Target: Rs 980 | Stop loss: Rs 1080| Return 6.2 %

Siemens has been trading with a corrective bias for almost five months after retesting its record high. It has recently witnessed a rebound but couldn’t surpass the resistance hurdle of long term moving average i.e. 200 EMA on the weekly chart.

After spending nearly a month in consolidation, it has formed a fresh shorting pivot and likely to see a fresh decline. We advise creating fresh shorts in the given range Rs 1045-1055. It closed at Rs 1037.45 on January 21, 2019.

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