Buy Coal India, Engineers India; sell ACC, Apollo Tyres: Anand Rathi

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Here are a few trading ideas from Chandan Taparia of Anand Rathi:

COAL INDIA: BUY

STOP LOSS: Rs 276

TARGET: Rs 293

The stock gave a consolidation breakout after holding the support near Rs 270 zones from last nine trading sessions. It formed a Marubuzo candle on daily chart and snapped the losses of previous two weeks. It is turning from the lower levels and managed to hold the gains even after the profit booking decline witnessed in the broader market. It gave the highest daily close of April, 2016. Thus, recommending to buy the stock with the stop loss of Rs 276 for the upside immediate target of Rs 293 levels.

 

ENGINEERS INDIA: BUY

STOP LOSS: Rs 169

TARGET: Rs 181

The stock surpassed its Rs 175 levels which has been acting as a hurdle from last three weeks and gave the highest daily close of last forty six trading sessions. The support base is shifting to higher levels and it has been making higher top – higher bottom formation from last forty one trading sessions. It has been taking support at its 50 DMA from last four sessions and held onto its gains. So, recommending to buy the stock with the stop loss of Rs 169 for the upside immediate target of Rs 181 levels.

 

ACC: SELL

STOP LOSS: Rs 1,495

TARGET: Rs 1,405

The stock after a continues positive move of last five weeks started to decline and witnessed a pause in the rally. It snapped the gains of last five trading sessions and witnessed liquidation of long position with a fall in open interest of around 5.40% in the previous session. Thus, indicating the longs are liquidating their position and there is lack of buying at the higher levels. A further profit booking decline might be witnessed taking the stock towards 1405 and lower levels. Thus, recommending to sell with the stop loss of Rs 1,495 levels for the target of Rs 1,405 levels.

 

APOLLO TYRES: SELL

STOP LOSS: Rs 170

TARGET: Rs 160

The stock fell below its Rs 165 levels and gave the lowest close of last thirty trading sessions. It witnessed built up of short position with open interest addition by around 5% in the previous session. We have fundamentally contrary view on the stock but suggesting a trade for immediate profit booking decline towards Rs 160 levels. So recommending to sell the stock with the stop loss of Rs 170 for the downside immediate target of Rs 160 levels.

Disclaimer : We are suggesting all these stocks to our clients but no personal holdings.

Chandan Taparia is a Derivatives Analyst - Equity Research at Anand Rathi

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