RBA, Black Box, Tata Steel: Jatin Gedia shares 3 stock ideas for today
Nifty's near-term trend remains positive as an inverted head-and-shoulders pattern points to a possible move towards 23,000-23,080.
Disclaimer: This article is written by Jatin Gedia, VP, technical research Teji Mandi Investment Technologies. Views expressed are his own. Readers' discretion is advised.
Nifty opened gap down and witnessed sustained selling pressure throughout the day, closing on a negative note and halting the two day recovery. On the intraday chart, the Nifty seems to be forming an inverted head and shoulders pattern which is a trend reversal pattern with the neckline placed at 22,800. The support is placed at 22,470 - 22,400 zone; below this, the pattern will be negated.
The momentum indicator has a positive crossover which is a buy signal and hence this dip after a two day rally should be considered as a buying opportunity with a strict stoploss placed at 22370 for an upside target of 23,000 - 23,080 where resistance exists in the form of the 20 day average. Bank Nifty also closed in the negative today; however, it has relatively outperformed the Nifty due to strength in the key heavyweights i.e. ICICIBANK and KOTAK BANK.
Today the PSU banks also picked up with the index closing with gains of 0.92 per cent for the day. Considering the price structure and the fresh positive crossover on the momentum indicator, the index is now poised for further upside towards 55,600 - 55,700 where the 20-day moving average is placed. Crucial support for Bank Nifty is at 54,400; below this level, the bullish stance is negated.
Stock ideas Buy RBA - ₹96.30 SL - ₹92 TGT - ₹102 Stock has broken out of a falling wedge pattern on the daily charts. Today it also broke out from an Inside Bar pattern on the daily charts suggesting resumption of the uptrend after a brief one day consolidation. Positive crossover on the momentum indicator indicates a buy signal.
Buy BBOX - ₹888.40 SL - ₹865 TGT - ₹953 Stock has broken out of a three-week consolidation with above average volume suggesting a genuine breakout. Momentum indicator formed a hook pattern further reinforcing the bullish bias Sell Tata Steel Oct Fut - ₹175.58 SL - ₹179 TGT - ₹169 Stock has broken down from a two-day consolidation and is thus resuming its downtrend. A negative crossover on the momentum indicator suggests a sell signal
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