Buy these 2 shares for gains while Nifty’s short-term trend continues to remain weak

Buy these 2 shares for gains while Nifty’s short-term trend continues to remain weak

By Nagaraj Shetti

After showing a sustainable upside bounce on Tuesday, Nifty witnessed sell on rise action on Wednesday and closed the day lower 88 points. A reasonable negative candle was formed on the daily chart that has partially engulfed previous bull candle. Technically, this pattern signal weak upside bounce in the market. This market action also indicates chances of Nifty revisiting the recent low of 17216 levels.

The short term trend of Nifty continues to be down and there is no confirmation of any significant bottom reversal at the lows. There is a possibility of further weakness towards the support of 17200 in the short term, before showing another round of minor upside bounce from the lows. A move below the support could open the next lows of around 16800 levels.

Buy CARBORUNDUM UNIVERSAL LTD- (CMP Rs 985) 

The stock price as per weekly timeframe chart has witnessed a sharp upside breakout of the sideways range movement at Rs 940 levels and closed higher. This upside breakout is expected to open a sharp upmove in the stock price in the short term. The weekly 10 period EMA is offering support and the positive chart pattern of higher tops and bottoms is visible as per weekly timeframe chart. Volume has started to rise during upside breakout and weekly RSI shows positive indication.

Buying can be initiated in CARBORUNIV at CMP (985), add more on dips down to Rs 940, wait for the upside target of Rs 1100 in the next 3-4 weeks. Place a stoploss of Rs 910.

Buy SPICEJET LTD – (CMP Rs 82) 

The aviation stock (Spicejet Ltd) has been in a sustainable upmove over the last couple of weeks. The stock price has made an attempt of upside breakout of the crucial overhead resistance of around Rs 85 levels, as per weekly chart but retraced down slightly on Tuesday. Further upside from here could open a sustainable upmove in the near term. Weekly RSI and weekly DMI/ADX patterns are showing positive outlook for the stock price ahead.

One may look to buy Spicejet Ltd at CMP (Rs 82), add more on dips down to Rs 78 and wait for the upside target of Rs 91 in the next 3-4 weeks. Place a stoploss of Rs 75.50.

(Nagaraj Shetti is a Technical Research Analyst at HDFC securities. Views expressed are the author’s own, please consult your financial advisor before investing.)