After Friday's flattish close, equity benchmark Nifty50 saw decent gains on September 5 despite weak global cues.
Even as the market has been showing resilience amid tough global conditions, geopolitical issues, concerns over inflation, rate hikes and a looming recession have continued weighing on sentiment and this trend may continue.
Fresh concerns over valuations have also emerged. As Shibani Sircar Kurian, Senior EVP & Head- Equity Research, Kotak Mahindra Asset Management Company pointed out that the valuations of Indian equity markets have re-rated recently and Indian markets are currently trading at a premium to historical valuations on a relative basis to other emerging markets.
"While this may lead to some near-term consolidation in markets, over the medium term, we remain constructive with the growth outlook in India appearing to be relatively stronger than most other economies, said Kurian.
Nifty has been hovering between the 17,450 -17,700 range for the last couple of sessions.
Amol Athawale, Deputy Vice President - Technical Research, Kotak Securities said the 20-day SMA (simple moving average) and 17,450 would be the important support zone while 17,700 could act as a major hurdle for the market.
"We are of the view that a directional upside move is possible only after the 17700 breakouts. Above this, the index could move up to 17,900-18,000. On the flip side, below 17,450 the index could retest the level of 17,250-17,150,” said Athawale.
The trajectory of the market is not clear and analysts advise betting on quality stocks. Based on the recommendations of various analysts, here are 14 stocks that can give healthy returns in the next 3-4 weeks. Take a look:
Analyst: Jigar S. Patel, Sr. Manager - Equity Research, Anand Rathi Share and Stock Brokers
This counter fell from ₹526 to ₹331 and but has stabilized near its historical support of ₹335. From the candlesticks pattern perspective, in August, this counter displayed a pair of Dojis, followed by pair of inverted bullish hammers along with volume steadily increasing which is hinting upside.
From the indicator perspective, daily RSI (relative strength index) has made impulsive structure near the oversold zone nicely which further confirms upside in counter. "One can buy in a small tranche at the current levels and buy another tranche at around ₹340 levels," said the analyst.
On the weekly scale, the stock has taken support near its previous historical support zone at ₹290-300. For the last one month, it has been making a nice base near ₹300 levels.
Recently on a weekly scale, the stock confirmed a bullish inverted hammer candlestick pattern exactly at the mentioned historical support and that is adding more confirmation of further upside in the counter.
Moreover, weekly RSI has nicely bounced back from 40 which is adding more strength to this counter.
Paras Defence and Space Technologies | Buying range: ₹692-696 | Target price: ₹790 | Stop loss: ₹650
This stock witnessed a long consolidation after a massive correction started in October 2021. It again saw some buying at the end of August 2022. The recent increase in price has been complimented by massive volumes.
Weekly RSI (relative strength index) has bounced back after taking support near 50 which further confirms the upside in the counter. "One can buy in a small tranche at current levels and buy another tranche at around ₹675 if tested, said the analyst.
Analyst: Sumeet Bagadia, Executive Director, Choice Broking
On a monthly chart, the stock has been trading with the support of 21 MMA which suggests a positive bias. It has formed a strong base around ₹640 levels while ₹925 will be a resistance level crossing above the same can show more upside rally.
On the weekly chart, the stock has been trading in a rectangle formation and consolidating near the resistance zone which points out strength in the counter.
Moreover, the stock has moved above "Ichimoku Cloud" with a positive crossover between the conversion line and the baseline, which shows the upside movement in the counter.
On the daily chart, the price has been trading with the middle leg of Bollinger Band which suggests a bullish rally will continue further in the near term.
Daily momentum indicator stochastic shows positive crossover which adds more bullishness to the price.
The stock is trading above 50 simple moving averages, confirming the support in price action. Moreover, it is also forming an inverse head and shoulder pattern on the hourly chart.
RSI plotted on the daily and the weekly timeframe is above 50 levels which reflects the strong momentum in the stock.
The Bollinger Band on the daily timeframe has started to expand with volume participation indicating that the volatility in the underlying is increasing for an upside move.
"On the safer side, near ₹1,478-1,480 levels would be a better range to enter. Closing and sustaining above ₹1,500 will lead towards ₹1,550-1,560 levels in the coming days," said the analyst.
Analyst: Vaishali Parekh, Vice President - Technical Research, Prabhudas Lilladher
The stock has indicated an uptrend and recently, with support taken near ₹250, it has pulled back quite decently moving above the 50EMA level of ₹265, improving the bias and having the upside potential to rise further in the coming days. With the RSI also on the rise is showing strength and is well placed to anticipate the further upward move.
This stock has gradually picked up momentum and is in a rising trend. It is currently taking support near the 50EMA level of ₹320 which is also the trendline support zone. It has picked up well with decent volume participation and has immense upside potential with bias looking positive. The RSI also has indicated a trend reversal to signal a buy.
The stock has witnessed a consolidation phase in the last month near ₹780 and recently has shown improvement in the bias with the price moving above the 50EMA level of ₹800.
The RSI has indicated a trend reversal and is well placed with upside potential witnessed to anticipate a further upward move in the coming days.
Analyst: Santosh Meena, Head of Research, Swastika Investmart
The counter is witnessing symmetrical triangle formation and resuming its northward journey. It is trading above its all-important moving averages and respecting 20-DMA beautifully.
It is trading above its multimonth resistance of ₹233 with a positive bias in momentum indicators. On the upside, ₹250 is an immediate hurdle then we can expect a move towards ₹280/300 levels. On the downside, 20-DMA around ₹225 will act as a strong support level.
This counter is likely to witness a breakout of a bullish inverse head and shoulder formation which is formed after a capitulation phase. On an immediate basis, it is respecting its 20-DMA whereas the previous swing low of around ₹675 will act as a sacrosanct support level.
Momentum indicator RSI is holding a support level of 60 and witnessing positive crossover. The neckline resistance is placed at the ₹775 level; above this, we can expect a rally towards ₹860.
The counter is moving in an upsloping channel formation in a shorter timeframe where it is ready to break out after almost one year of consolidation.
The key horizontal resistance line is placed at the ₹540 mark; above this, we can expect a fresh leg of expansion. On the downside, 20-DMA of ₹507 is an immediate support level while ₹480 is sacrosanct support at any pullback. Momentum indicators are positively poised to support the current strength of the trend.
Analyst: Ravi Gangan, Technical Trader, Mehta Equities
This IT company is witnessing minor correction currently which is the ideal opportunity to buy at the current market price. The stock has the strength to go upside over the very long term so accumulating more with buy on dips strategy is the preferred strategy. Indicators such as MACD, RSI, and Bollinger Bands on the weekly chart give positive signals altogether.
This defence stock touched its new 52-week high of ₹2,424.60 on September 2, 2022. However, it is the tendency of any stock to correct post making a new high. To grab at this corrective point is again an ideal strategy. Also, the prices are consolidating near the highs which will help to cool off its RSI overbought conditions.
Prices have been consolidating after giving gap up opening a few sessions ago. This sideways action will be ideal to accumulate at the current prices. This positive action can continue up to ₹8,000+ levels; on the downside, ₹6,795 remain intact as stop loss.
Disclaimer: The views and recommendations given in this article are those of individual analysts and broking firms. These do not represent the views of MintGenie.
