Technically speaking! Here are Karvy’s top 10 value picks for April
by Admin |12/04/2018
April series has begun on a good note for the Nifty, with the index rising around 2 percent so far. As such, the Street has entered a phase of consolidation, after falling around 10 percent from the all time highs witnessed in January.
The Nifty, in the last week, witnessed the continuation of the short-term pullback that had originated from sub-10,000 levels in the penultimate week. However, experts feel that it would be wise to use pullback rallies to short the index.
The pullback has done descent retracement of the previous fall and has now reached a crucial resistance zone i.e. 10300-10350. There are multiple parameters, lying over there, to restrict further upside.
Among the oscillators, MACD is trading above the signal line with broadening bands in daily charts which suggests positive momentum in the counter. Another major indicator Stochastic suggests positive momentum in the counter.
The recent price action suggests the momentum in the stock to continue in the coming month as well. Thus, we recommend buying the stock for targets of 1973 and 2035 levels with a stop loss placed below 1590 levels.
The stock price has broken the streak of lower lows on the same chart indicating that going forward the recent low is most likely to hold, reversing the trend to positive from medium term perspective.
On the indicator front, the monthly RSI has generated a bullish crossover as a long bullish candle stick has been formed which has been supported with above average volumes, all indicating to a positive bias in the counter and re iterating our view on the stock.
The stock has resumed its up move after making swing low of around 533 levels and bounce in the stock has seen supportive volume formation on daily charts. Prior to that, the stock has seen profit taking from its life time high of 1381.60 levels which has dragged the stock to the low of around 533 levels. Thereafter, the stock has resumed its up move and retraced 61.8% of retracement levels drawn from the high of 1381.60 levels to the low of 532.65 levels and managed to close well above the same.
The stock is on the verge of giving price breakout around 1130- 1135 levels. The move above the said levels will provide fresh trigger to the stock and stock can touch 1200- 1225 levels in near term. Hence, we are suggesting buy in the stock for the target of 1225 levels with stop loss placed below 1000 levels.
In the short term time frame, analyzing the price volume action, the stock seems to be extremely poised to move higher towards the psychological mark of 245-250 levels. On the other side, the Bollinger band (20, 2) on the daily charts is also pointing northwards with price rolling on its mean indicating the direction of the counter is on the long side with supports on the lower side shifting higher with the lower band. Also the Parabolic SAR is also trading well below the current market price of the counter indicating northward movement is likely to continue.
The stock is also trading above the cluster of major short and long term moving averages with technical indicator 14 day RSI showing reading in the comfortable zone, clearly indicating the bullish trend is likely to remain intact in the counter. On the other hand, the overall chart structure of the counter seems to be bullish from a medium term perspective till the stock price is trading above 205-210 levels on the lower side, while dips towards the recent support levels of 211 may be utilized to average the stock.
Taking the above data facts into consideration, we recommend short term traders to enter the stock at the current levels for the potential targets of 242-248 levels. Any dip towards the 211 levels may be utilized to average the stock with a strict stop loss
Hindustan Unilever has been defying the broader market fall and has been holding onto the psychological 1300 levels on a weekly closing basis from the past few weeks. The overall chart structure of the FMCG MNC looks good as the stock is just moving out of its consolidation zone around current levels.
As mentioned earlier, in the recent past, the stock has been consolidating comfortably above all the mentioned EMA’s like the 21, 50 and 200 day EMA at Rs.1319, Rs.1324 & Rs.1236 respectively, thereby indicating the inherent strength in the counter. Though the stock ended the month of March 2018 with a meager gain of 0.52%, it outperformed the broader index Nifty (-2.59%) by a significant margin during the same period even as the global sentiment was dampened due to various reasons.
We expect Hindustan Unilever to continue its uptrend towards the target levels in the uncharted territory. Therefore, we recommend buying the FMCG major around current levels, average around Rs.1260 with a strict stop loss placed below Rs.1199 for potential upside targets of Rs.1469 - Rs.1480 in about a month’s time.
The stock in the recent past has been consolidating, and this consolidation has been happening comfortably above all the mentioned EMA’s like 21, 50 and 200 day EMA at Rs.1301, Rs.1306 & Rs.1225 respectively, thereby indicating the counter is in the firm grip of the bulls. The stock ended the month of March, 2018 with a reasonable gain of 1.46% simultaneously outperforming the broader index Nifty (-2.59%) by a considerable margin during the same period.
The stock also has immediate hurdle around the Rs.1340 -1360 zone, therefore crossing and sustaining above the said zone, an excellent round of buying may come in the counter in its run up towards the targets and also helping the stock in penetrating through the lifetime high area yet again.
The ADX (29.83) on the weekly timeframe is also currently trading just above the 25 mark suggesting that the stock is likely to witness more momentum if the stock surpasses the immediate resistanc