After six consecutive sessions of gains, the equity benchmark Nifty ended in the red on July 25 as investors booked profit anticipating volatility in the market in the run-up to the US FOMC outcome.
Mixed quarterly earnings of some of the heavyweights such as Reliance Industries and Infosys also weighed on sentiment.
The biggest near-term trigger for the market now is the US FOMC outcome which is scheduled for July 27. However, some analysts believe it may not affect the market much since a 75bps rate hike is widely expected.
"The Fed's rate announcement on July 27 is not likely to impact the market much since a 75 bps rate hike is already known and discounted by the market. The market will be keenly watching the Fed commentary for near-term triggers," said V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services.
In the short term, the market will continue to react to quarterly earnings and macroeconomic prints. Even though the market sentiment appears to be improving after the return of FPIs, it is early to say that the market will sustain gains.
Amid the uncertainty, analysts advise betting on these 10 stocks to get decent gains in the short term. Take a look:
Analyst: Tirthankar Das, Head of Technical Research, Ashika Group
This cement stock witnessed a technical pullback last month after a recent sharp decline. It saw a pullback from extreme oversold territory and generated a breakout above the falling channel containing the last six months' decline signalling a rally to continue with a fresh entry opportunity.
The stock is expected to continue with its last month's up move and head towards ₹7,050 in the coming weeks as it is the 23.6% retracement of the entire rally since March 2020. On the oscillator front, the weekly 14-period RSI is in an uptrend and in a neutral price region indicating momentum to continue.
Buying demand is seen emerging in the stock from major support areas, thus offering a fresh entry opportunity with a favourable risk-reward set-up. The stock has recently generated a breakout above the trendline joining the last six months' highs and is seen sustaining above its 200-day moving average signalling a resumption of up move.
The stock price rally is well supported by volume indicating larger participation in the direction of the trend. Hence, it can be expected that the stock will maintain a positive bias and head towards ₹1,250 in the coming sessions as it is the 78.2% retracement of the Jan’22 decline.
Analyst: Sumeet Bagadia, Executive Director, Choice Broking
On a weekly chart, this stock has given a breakout of the resistance level of ₹2,265 which suggests upside movement in the counter.
Furthermore, the stock has formed a good base around ₹2,200 which suggests strength in the counter.
It has been trading above the 21-day moving average which shows a positive trend for the time being. Daily momentum indicators 'stochastic' and MACD have shown positive crossover which adds more bullishness to the price.
On the daily timeframe, the stock has been moving in higher high –higher low formation suggesting a bullish trend which may continue.
A gradual rise in volume and surging prices confirm bullishness in the trend. The scrip has taken support of 50 and 20 simple moving averages.
Indicators such as RSI and MACD confirm the positive trend.
The scrip has given a breakout of resistance zone of ₹700-705 and is sustaining above the said levels. After the reversal from its multiple support zones, the hourly charts are into a gradual up move and in a rising parallel channel pattern.
Analyst: Santosh Meena, Head of Research, Swastika Investmart
This stock is witnessing strong bullish momentum followed by a breakout of symmetrical triangle formation on the daily chart. It is one of the strongest counters in the banking space and it is trading above its all-important moving averages.
On an immediate basis, ₹820-830 is the resistance area then ₹880-900 is the next target zone. Momentum indicator RSI is heading into overbought territory on the daily chart, however, there is still a lot of room on the weekly chart therefore every small correction will be a good buying opportunity.
On the downside, ₹770-755 will act as a strong support zone.
The counter has witnessed a breakout of falling wedge formation on the daily chart and managed to close above its 200-day moving average.
On an immediate basis, ₹830 is an important hurdle, above this, we can expect a rally towards ₹887/945. On the downside, a cluster of moving averages at ₹740 will act as a major support level. Momentum indicators are positively poised to support the current bullish momentum.
The capital goods space is leading the current rally in the market and Gridwell Norton is witnessing a breakout of bullish flag formation to resume its classical uptrend.
It is trading above its all-important moving averages and the momentum indicator RSI is holding well above the 50 mark with positive divergence.
On an immediate basis, ₹1,818 is an important hurdle then there is no major resistance till ₹1,970. On the downside, ₹1,650-1,600 is a strong demand zone.
Analyst: Jigar S. Patel, Sr. Manager - Equity Research, Anand Rathi share and stock brokers
This stock has corrected almost 38% from its top of ₹6,133 which was made on January 4, 2022. In July, it has been consolidating near the crucial support zone of ₹3,400-3,700.
Recently the stock confirmed a 'hammer' candlestick pattern exactly at the mentioned support followed by healthy positive volumes and that could be a sign of early reversal. In addition to the above-discussed technical rationale, the counter has confirmed a breakout from the trading range of ₹3,400-3,700 and has closed near ₹3,72.
Ramco Cements seems to be oversold and we are witnessing a positive crossover in MACD on the weekly scale along with the impulsive structure on weekly RSI near the oversold zone. This indicates the possibility of a bounce in the coming sessions.
In addition; we are witnessing a bullish engulfing candlesticks pattern on the weekly scale. Since the past few sessions, the counter has broken the upper side of the trend line and recently it confirmed a breakout from this trend line on a closing basis.
This stock has corrected almost 37% from its top of ₹3,659.75 which was made on October 19, 2021. In the last two months, it has been consolidating near the crucial support zone of ₹2,100-2,200 and made a base near its support with rising volume.
Recently, the stock confirmed a 'hammer' candlestick pattern exactly at the mentioned support and that could be a sign of early reversal. In addition to the above-discussed technical reasoning, the counter has confirmed classic bullish divergence along with bat action magnet move.
Disclaimer: The views and recommendations made above are those of individual analysts or broking firms and not of MintGenie.
