Use current fall as bargain-hunting opportunity to go long, bet on these 3 stocks for double-digit return

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A breakout above 11,500 marks where descending trend line on lower time frame is placed, will give confirmation of retracement complete and original uptrend begin.


Shabbir Kayyumi
Nifty, after rallying for nearly 1,000 points in just two trading sessions post-corporate tax cut announcement, now has corrected by some 450 points denting the market sentiment. Technically, after making a high of 66 in the last week, the RSI momentum oscillator is retracing towards the breakout point of 50 which should be considered as a pullback buy setup (PBB) and it can be used as a bargain-hunting opportunity to go long.
On the lower side, the confluence of supports is in a zone of 11,000-11,150 levels. These support mainly consist of a line of parity placed at 11,150, 61.8% Fibonacci retracement levels of current rise standing at 11,060 and strong psychological levels 11,000. One should add longs as far as Nifty is trading above this crucial demand zone.
In a trend sense, recently moving average bullish crossover of 20 DMA and 50 DMA has happened which is supportive of positive momentum in the mid-term. At the same time, a breakout above 11,500 marks where descending trend line on lower time frame is placed, will give confirmation of retracement complete and original uptrend begin.
Banking index is witnessing heightened trading volatility but till it sustains above the short-term moving average (20 DMA) placed at 28,260 levels, a positive bias is intact in the near term. Nevertheless, a sustained move above 200 DMA placed around 28,800 will add strength whereby prices can extend higher towards 30,500 levels.
Trade Recommendation:
Mac Ventures and  Industries | Rating: Buy around Rs 42| Target: Rs 52| Stop Loss: Rs 39 | Upside: 23 percent
This stock has a flag pattern in the weekly chart which is on the verge of resumption of its prior uptrend. It is currently trading above its key short term moving averages namely the 9 and 21 EMA, indicating short and medium-term trends on the upside are intact and accelerating. The momentum indicator MACD has crossed the signal line indicating a start of a trend. We recommend a buy in the stock around Rs 42 with a stop loss of Rs 39 and a target of Rs 52.
Hero MotoCorp | Rating: Buy around Rs 2,650 | Target: Rs 3,050| Stop Loss: Rs 2,480 | Upside: 15 percent
This sock has formed an Inverse Head & Shoulder pattern on the daily chart. The crucial resistance of the 200 SMA has been recently taken off which indicated short term momentum to the uptrend. The momentum indicator RSI too is above its key 60 marks indicating momentum on its side. Looking at the above-mentioned rationale, we are suggesting a long in Hero MotoCorp around Rs 2,650 with a stop loss of Rs 2,480 and target Rs 3,050.
Maruti Suzuki India | Rating: Buy around Rs 6,600 | Target: Rs 7,300| Stop Loss: Rs 6,200 | Upside: 10 percent
The stock has a Cup and Handle Pattern in the daily chart which is on the verge of a breakout. The crucial resistance of the 100 DMA and 200 SMA has been recently taken off which indicated short term momentum to the uptrend. The momentum indicator RSI too is above its key 60 marks indicating momentum on its side. Buy should be initiated around the breakout outline of a cup and handle pattern, which is Rs 6,600 with a stop loss of Rs 6,200 for the target of Rs 7,300.
Source by:- Mobeycontrol
Professional Advisory for Help and Support- AllianceResearch


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