Domestic market benchmarks the Sensex and the Nifty traded in the red on February 6 amid weak global cues as the robust US job numbers fanned fears that the US Fed will continue raising rates.
The tight labour market in the US indicates continuing strength in the US economy but it also indicates that the Fed will be forced to remain hawkish for an extended period of time.
In short, the market may remain volatile in the near term unless more clarity emerges on the front of rate hikes and inflation.
Considering the uncertainty, analysts advise betting on stocks with good fundamentals and positive technical indicators.
Based on the recommendations of several analysts, here are eight stocks that can give decent returns in the next 3-4 weeks.
Analyst: Sumeet Bagadia, Executive Director, Choice Broking
Asian Paints has been consolidating in a price range of ₹2,700 to ₹2,775 for more than a week.
There is resistance in the area of ₹2,775 and ₹2,790, and once it is overcome, Asian Paints will enjoy a strong rally.
The stock may very well be turning around because the RSI is at oversold levels. It has developed a Harami pattern on weekly charts, indicating a reversal is about to occur.
"With a stop loss of ₹2,665 and targets of ₹2,830 and ₹2,865, we advise purchasing Asian Paints around ₹2,760 and adding at ₹2,720," said the analyst.
M&M has hit its all-time high after producing a descending triangle breakout. It has been in a brief consolidation period between ₹1,330 and ₹1,390 for roughly a week.
M&M is trading above all of its moving averages, indicating that the script has solid momentum.
In the past two months, M&M has outperformed the Nifty50 by 10 percent, indicating that it has a strong relative position to its benchmark.
M&M may hit new highs and maintain its momentum until it has overcome its resistance zone of ₹1,390.
"We advise buying M&M at levels between ₹1,390 and ₹1,350 with a target range of ₹1,485 to ₹1,515 and a stop loss level of ₹1,320," said the analyst.
On the weekly chart, the price action settles strong traction at ₹975 level, confirming bullishness in the stock.
Moreover, it is also forming higher high higher low formations on the daily chart. On the daily chart, it is trading above 50 simple moving averages, confirming the support in price action.
The price is trading above the Ichimoku Cloud and a positive crossover is indicated in RSI and MACD as well which suggests continuity in the bullish trend in the near term.
Sustaining high volume points out buying interest.
"Based on the above technical structure, one can initiate a long position at the current market price. However, on the safer side, near ₹1,015-1,018 levels would be a better range to enter. Closing and sustaining above ₹1,045 will lead to ₹1,090 levels in the coming days," said the analyst.
Analyst: Vaishali Parekh, Vice President - Technical Research, Prabhudas Lilladher
The stock has been in a consolidation phase for quite some time, moving within a tight range and maintaining a strong support zone near ₹1,560-1,580.
It has indicated a positive bullish candle pattern with decent volume participation, overall indicating an ascending channel pattern on the daily chart.
A further rise is anticipated with a near-term target expected at ₹1,800. The RSI once again is showing a trend reversal and has a visible upside potential.
The stock has indicated an ascending channel pattern on the daily chart. Currently, the price is witnessing a short correction, taking support near the lower trendline support of the channel.
The 50EMA level is acting as the base. Further rise is anticipated to ₹2,400 with bias getting better and the RSI is also showing a trend reversal to signal a buy.
Analyst: Jigar S. Patel, Senior Manager - Equity Research, Anand Rathi Share and Stock Brokers
For the last three months, this counter has been making higher highs and higher lows structure.
Recently it broke its previous swing high of ₹76.30. The six-month-old trendline was also broken. It is currently sustaining above it, hinting at an upside in the counter.
The hammer candle is seen taking support near 100 DEMA, which looks lucrative.
Daily DMI is in bullish mode also it broke its previous swing, indicating bullishness in the counter.
In the last couple of months, this counter has corrected almost 18 percent and currently, it has made a nice base near ₹450-455.
Buying volume is gradually increasing from lower levels, indicating bullish momentum in the coming few sessions.
On a daily scale, the MACD histogram and RSI bullish divergence were seen, confirming the bullish stance in the counter.
Though Laurus is looking weak at the current juncture, one needs to pay attention to its fall from ₹440 to date.
Selling volume is not rising with a fall in price which is an anomaly according to volume spread analysis.
In another word, volume is not in sync with the price.
Also, on a weekly scale, a bullish AB=CD pattern has formed near its historical support zone of ₹320-330. The weekly MACD histogram is losing downward momentum, hinting towards some bounce in the coming few weeks.
Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of MintGenie.
