Nifty chart suggests positive trend in upcoming sessions; these two stocks set to gain

Nifty chart suggests positive trend in upcoming sessions; these two stocks set to gainBy Subash Gangadharan

After consolidating between the 8960-9180 levels for the last few sessions, the Nifty has now convincingly broken out of this range. In the process, the Nifty index now trades firmly above the 50-day SMA and the 14-day RSI too is in rising mode and above its 9-day EMA. The 60-minute Nifty chart too indicates a positive trend as the pattern of higher tops and higher bottoms seen in the last five sessions is intact. The Nifty needs to hold above the immediate lows of 9004 for this pattern to remain intact. Immediate upside targets for the Nifty are now at the recent highs of 9383-9440. If the Nifty can convincingly cross these levels, then we could see further upsides in the coming sessions.

Buy ICICI Bank (CMP is Rs.318.85)

Stop Loss: 300

After falling sharply for several weeks and testing the intermediate supports of 285, ICICI Bank has bounced back smartly and made a double bottom pattern on the daily charts. The stock has gradually moved higher today and made higher bottoms on the intraday charts today, on the back of higher than average volumes. This indicates that the stock is ready to continue the next leg of the underlying uptrend.

Technical indicators too are giving positive signals as the 20 minute MA is currently above the 50 minute MA on the 15-minute intraday charts. This is a positive signal for the near term at least. The 14-day RSI too is in rising mode. We, therefore, recommend buying ICICI Bank between 310 and 321. Targets are at 365, while stop loss is at 300.

Buy Titan (Rs.886)

Target: 1000

Stop Loss: 835

Titan has bounced back smartly from the lows of 810, where it has made a double bottom on the daily charts. The recent rise has come with above average volumes, which is healthy. In the process, the stock has also moved above the 837-860 trading range in which it was trading recently, which is a sign of strength. Momentum technical indicators too are giving positive signals as the 14-day RSI is in rising mode. We, therefore, recommend buying Titan between 860 and 887. Targets are at 1000, while stop loss is at 835.

(Subash Gangadharan is a Technical & Derivatives Analyst at HDFC Securities. Views expressed are the author’s own)