Nifty crosses previous swing high, short-term trend reverses; Laurus Labs, JK Paper among stocks to buy

Nifty crosses previous swing high, short-term trend reverses; Laurus Labs, JK Paper among stocks to buy

By Subash Gangadharan

On the daily chart, we can observe that the Nifty has corrected recently and found support near the 50 day SMA. It has subsequently bounced back and made higher tops and higher bottoms on the 15 min intraday charts.

Stock picks for the next 15-26 trading sessionsLaurus Labs | Buy

Laurus Labs has corrected from an intermediate high of 605 tested in August 2022 and found support at the 286 levels in March 2023, which also coincides with the previous intermediate lows, thereby indicating it is a strong support.

Laurus Labs has since then bounced back and made higher tops and higher bottoms over the last few months. Recently, Laurus Labs has broken out of its recent trading range on the back of above average volumes. And has subsequently pulled back and bounced from close to the 200 day EMA. This augurs well for the uptrend to continue.

Technical indicators too are giving positive signals. Laurus Labs is currently trading above the 20 day and 50 day SMA. Weekly momentum indicators like the 14-week RSI too are in rising mode and not overbought, suggesting scope for more upsides. With the intermediate technical setup looking positive, we believe Laurus Labs has the potential to move higher in the coming weeks and therefore recommend a buy between the 389-393 levels. CMP is 391.8. Stop loss is at 360 while target is at 440.

JK Paper | Buy

JK Paper has shown relative strength this week. While the Nifty index has risen by 0.1% this week, JK Paper has gained 5.91% over the same time period.

Zooming into the daily chart, we can observe that JK Paper has made a double bottom around the 306 levels and broken out of the recent trading range on Wednesday on the back of above average volumes. JK Paper is now trading above the 20 day and 50 day SMA. And momentum readings like the 14-week RSI are in rising mode and not overbought, which implies potential for more upsides.

With the intermediate technical setup looking positive, we believe JK Paper has the potential to move higher in the coming weeks and therefore recommend a buy between the 350-354 levels. CMP is 352.4. Stop loss is at 332 while target is at 392.

(Subash Gangadharan, Senior Technical and Derivative Analyst, HDFC Securities. Views expressed are the author’s own. Please consult your financial advisor before investing.)