Hot Stocks | MMTC, SJVN, PCBL can provide high, short-term double-digit returns. Reasons why

  • Aug. 30, 2022, 1:22 p.m.

The Nifty has confirmed a lower top and lower bottom on the daily chart by falling more than 1% on August 29.The benchmark closed below its 21-day EMA (exponential moving average) support level of 17,391. In the week ended August 19, the Nifty formed a bearish 'Shooting Star' candlestick pattern on the weekly charts, which was the first sign of correction in the index.

The index is currently in the continuation of a short-term downtrend, and the correction could extend to the next support level of 16,900, which is a 38.2 percent retracement of the entire rise from 15,183 to 17,992.

Indicators and oscillators like RSI (relative strength index), MACD (moving average convergence and divergence) and DMI (directional movement index) have turned bearish on the Nifty daily chart, which confirms the short-term down trend for the benchmark index.

However, the breadth of the market does not seem to be under pressure at all. The Smallcap Index has not violated its 21-day EMA, rather it closed near the day’s high on August 29. The Nifty Midcap and Smallcap indices have formed a bullish Marubozu candlestick pattern on the daily chart, which indicates that there is so much buying interest in the underlying that the market participants were willing to buy the stock at every price point during the day.

Considering the evidence discussed above, we believe that the markets will remain stock-specific with the participation of small-cap and mid-cap stocks. However, the benchmark index will remain in a short-term correction mode where the next support is seen at 16,900. Resistance for the Nifty is seen at 17,500 and 17,725.

Here are three buy calls for the next 2-3 weeks:

Buy | LTP: Rs 44.1 | Stop-Loss: Rs 40.5 | Targets: Rs 49-53 | Return: 11-20%

The stock has broken out of multi-week consolidation with rising volumes. It has also surpassed the crucial resistance of its 200-day EMA, placed at Rs 42.

Indicators and oscillators have been showing strength on the daily chart.

PCBL: Buy | LTP: Rs 129.65 | S/L: Rs 118 | Targets: Rs 144-153 | Return: 11-18%

The stock has been forming higher tops and higher bottoms on the daily chart. The stock is placed above all important moving averages, indicating a bullish trend on all time frames.

It is on the verge of registering a new all-time high above Rs 135.

Buy | LTP: Rs 29.95 | SL: Rs 28 | TP: Rs 34-37 | ROI: 13-23 percent

The stock has broken out from the narrow consolidation which held for the last 7 weeks. A price breakout is accompanied by a jump in volumes.

The PSU sector has been outperforming for the last two months and the same is expected to continue. The stock has found support at its 50-day EMA, which is located at around Rs. 28.Indicators and oscillators' setup is bullish on daily and weekly charts.

Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before making any investment decisions.

Author : Rajdhani Delhi Representative

Rajdhani delhi representative

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