As the domestic market opened on a positive breadth after a bear hammering session last weak. Here the top technical picks from Milan Vaishnav which would help investors earn good returns in the short term.
Jubilant Foodworks | Sell | Target: Rs 1130
After peaking out at 1575 in 2018 and forming a lower top at 1487 after that, the stock has remained under sustained corrective pressure. The prices are currently under a bearish Descending Triangle Formation. The RS Line, when compared against the broader markets, is seen sharply moving lower and ruled below its 50-DMA. The price of the stock also presently trades below its 50-DMA and 200-DMA, which indicate a bearish setup. There are high probabilities of this pattern, resolving with a downside breakdown over the coming days. The price has currently moved below lower Bollinger bands which shows the high possibility of a breakdown from current levels. Any close above 1270 should be a stop-loss for this view.
The stock is in a bullish ascending triangle formation. A golden cross has occurred on the charts as the 50-DMA has just crossed 200-DMA from below. The PPO is about to turn positive while daily MACD is sharply moving towards a positive crossover. The RS line, when compared against the broader markets, has formed a higher bottom and appears to be moving higher. It has moved past its 50-DMA as well. The Bollinger bands are over 63% wider. This increases the possibilities of a sharp move in price over the coming days. A resumption of up-move in this stock cannot be ruled out. Any close below 155 will be a stop-loss for this view.
PVR | Buy | Target: Rs 1850
Some serious momentum is seen building up on this stock. It has attempted to break out of a broad symmetrical triangle and piercing the falling trend line which begins from 1829 and joins subsequent lower tops. The price has closed above the upper Bollinger band and this has further increased the chance of a sustained up move in the stock. The daily MACD stays in continuing buy mode. The RSI has made a higher bottom and has moved past its previous high. RS Line looks stable and it is above its 50-DMA. On the longer term weekly charts, the stock broke above its major double top formation, suffered a throw back, and it is now seen inching higher. Though a minor pullback inside the band cannot be ruled out, there are higher chances of resumption of sustained momentum in the stock. Any close below 1790 will be a stop-loss for this view.
Tube Investments of India | Buy | Target: Rs 450
After peaking out near 434 and seeing a sharp correction which took the stock to 348, the price has remained in a sideways trajectory after that. The stock has remained in a three and a half month long trading range, and it has attempted a breakout. The RS Line, when compared against the broader markets have sharply moved higher and ruled above its 50-DMA. The daily MACD has shown a positive crossover, and it is now bullish while trading above its signal line. The price has ended above the upper Bollinger band, and this has increased the possibilities of the breakout sustaining and stock inching higher. Any close below 385 should be treated as a stop-loss for this view.
Hedged option call
For the July 18 expiry, the Bank Nifty shows highest Call OI built up at 31000 and this level is likely to act as resistance. The highest Put OI is at 30000 strikes. In most likelihood, the Index is expected to oscillate in a broad range.
(IMPORTANT: The Option Prices shown are as of Friday’s Close. The Pay-off Chart, Maximum Loss and Maximum Profit Potential can vary as per the actual execution price)
(Disclaimer: The opinions expressed in this column are that of the writer. The facts and opinions expressed here do not reflect the views of www.economictimes.com.)