During a week under review, the Nifty index managed to sustain above its long-term moving averages on a closing basis, and also managed to close above 20-day EMA resistance placed around 10,821
The Indian equity market ended the weekly session on a positive note despite remaining flat intraday on January 18. There was some optimism on account of the US-China trade talk, easing of December inflation at 2.19 percent, and strong Q3FY19 earnings by a specific company that managed to offset negative concerns arising on the ground of governance issue in the India pharma sector.
During the week under review, the Nifty managed to sustain above its long-term moving average on closing basis, and also managed to close above 20-day EMA resistance placed around 10,821.
The index formed a weekly low of 10,692 and rebounded to form a weekly high of 10,930. It gained about 1.03 percent in the week.
The gain was primarily led by Nifty Energy and IT that were up by 4.8 percent and 4.1 percent, respectively. While the Nifty Media and Pharma were among the biggest losers that were down by 4.2 percent and 2.3 percent, respectively.
The Nifty formed a bullish candlestick pattern on the weekly price chart, whereas it formed a small bearish candlestick pattern on the daily scale.
The momentum indicator signalled a positive divergence with its RSI at 56 and MACD which also started to trade above its signal-line on the daily scale.
With index managing to sustain above 10,740 on a closing basis, the next crucial resistance is currently placed at 10,985 followed by 11,035 and supports are seen at 10,690 level.
With talks on interim-budgets looming across coupled with crude oil strengthening back to $60 level, the equity market currently is expected to remain slightly volatile.
Here is a list of top three stocks that could return 3-5 percent in the next 1 month:
Indraprastha Gas: Buy| Target: Rs 295| Stop loss: Rs 265 | Upside: 5 percent
Indraprastha Gas maintained an upward trajectory for the last one week despite a negative market breadth and managed to swiftly move upward from its crucial resistance of 200-day moving average placed at Rs 269 on a closing basis.
Initially, the scrip made a healthy consolidation from a price-band of Rs 320 level towards a low of Rs 215. After making a strong rebound towards Rs 290 level, it saw a substantial fall towards the support of Rs 240 level but managed to regain the upward momentum post-consolidation.
The scrip formed a solid bullish candlestick pattern on weekly price chart along with a bullish pattern on a daily scale.
The momentum indicator outlined a positive divergence in price with its RSI at 66, coupled with MACD managing to make a bullish crossover in the same period to trade above its signal line. We have a buy recommendation for Indraprastha Gas which is currently trading at Rs 280.45.
Sun TV Network: Sell | Target: Rs 504 | Stop loss: Rs 560 | Downside: 4 percent
Sun TV continued to trade in negative trajectory for an extended period to fall below its crucial support of 200-day moving average placed at Rs 640 level in the previous session.
The scrip continued to consolidate from a higher level of Rs 830 level towards a low of Rs 560 level and made a marginal reverse trend that failed in the later period. The scrip made a 52-week low of Rs 513 in last trade that indicates sustain selling pressure.
It formed a long bearish candlestick pattern on both daily and weekly price chart. Further, a weekly RSI stood at 29 indicating persistent selling regime, and MACD continued to trade above its signal line. We have a sell recommendation for Sun TV Network that is currently trading at Rs 525.20.
ICICI Securities: Sell| Target: Rs 221 | Stop loss: Rs 240 | Downside: 3 percent
After remaining in a muted direction for 2-3 weeks, ICICI Securities came under massive selling pressure in last three trading sessions to close below its crucial support placed at Rs 250 level, and to trade point away from its 52-week low of Rs 225.
The scrip breached below its all crucial moving average levels in current trade despite making an attempt to reverse the trend that failed to keep scrip under selling regime.
The scrip formed a long bearish candlestick pattern on both daily and weekly price chart that indicates persistent selling pressure.
The momentum indicator continued to outline weak trend with weekly RSI at 33 as MACD started to trade below its signal line in past sessions. We have a sell recommendation for ICICI Securities that is currently trading at Rs 228.70.
Disclaimer:-The views and investment tips expressed by investment experts are their own. Ripples Advisory advises users to check with certified experts before taking any investment decisions.
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