Trading ideas: Two stock recommendations for coming week
With regards to the Nifty Bank index, it has again disappointed after giving a breakout on the daily chart
The domestic equity market stood dubious and traded within a narrow range for the second consecutive week. The benchmark NSE Nifty index made an attempt to clear the lifetime high of 15,915 but turned from 15,914 to reach towards 15,600 mark. However, it managed to sustain above the important support of 15,600 on a closing basis. Eventually, it closed the week with a marginal loss.
For the coming week, we expect the previous swing low of 15,450 to act as strong support for the index. Unless that support is not broken on daily closing basis the short term trend still remains strong. However, on the upside fresh momentum would be seen only above 15,750 levels. In that scenario, we could see new highs in the market.
The upside from here too won’t be that easy since the volatility index VIX is trading near its bottom. The zone of 12-10 has been a support for years in VIX and there is a possibility of a spike in it from here on.
With regards to the Nifty Bank index, it has again disappointed after giving a breakout on the daily chart. The index confirmed a trend line breakout but failed to clear the 35,800 mark. For further momentum on the upside, the index should close above the 35,800 mark. Then we could see lifetime highs in the index. On the downside, the level of 33,900 could be a major decisive support for the coming weeks. A breach of the same might result in strong selling pressure in the banking space which could drag the index towards 33,000-32,000 in July 2021.
Recommendations:
Indiabulls Housing Finance | Buy | Stop loss: Rs 260 | Target price: Rs 286
Strong bullish candle at the support on the daily scale along with trend line breakout. The price action was followed by rising volumes.
Symphony | Buy | Stop loss: Rs 1,035 | Target price: Rs 1,140
The stock is turning from the support of 200 DSMA and 200 DEMA. This is a sign of strength and it has also confirmed a breakout from the falling trend line.
(The writer is AVP: technical research at Anand Rathi Shares and Stock Brokers. Views expressed are personal)