Nifty outlook and top stock picks by Motilal Oswal Securities

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Nifty Outlook:
The Nifty index opened positive but follow up buying was missing at higher levels and it got stuck in a range of 40-50 points for the entire trading session. It has formed a contradicting pattern on the daily scale which suggests initialization of sideways momentum. Now till it holds above 10680, it can extend its up move towards 10780 - 10800 zones while a hold below 10680 could drag it towards 10638 then 10600 zones.

Stocks:

NIIT TECH

Reco: BUY

Last Close: Rs 1059

Stop Loss: Rs 1020

Target: Rs 1130

Retest of previous breakout creates buying opportunity and it is trading above 50 & 200 EMA in all the time frame which indicates strength.

HINDALCO

Reco: BUY

Last Close: Rs 238.70

Stop Loss: Rs 232

Target: Rs 253

It has been respecting rising trend line and surpassed its 50 DEMA. Spike in volumes and RSI has given positive cross over.

CONTAINER CORPORATION OF INDIA

Reco: BUY

Last Close: Rs 1399

Stop Loss: Rs 1373

Target: Rs 1451

It has given Inverse Head & Shoulder breakout on daily chart with surge in volumes and RSI has given positive cross over above 60 zones which indicates positive momentum.


STRATEGY

HINDPETRO - BULL CALL SPREAD +310-320

BUY HINDPETRO 1 LOT OF 310 CALL

SELL HINDPETRO 1 LOT OF 320 CALL

NET PREMIUM PAID: 3.55

MAX RISK: 3.55 (Rs. 5591/-)

MAX REWARD: 6.45 (Rs. 10159/-)

  

Rationale:
  • The stock is turning from deep oversold territory
  • It has reversed from its double bottom support of 290 zones
  • Huge shorts are seen in the counter so hold at current level might attract short covering activity. 
  • Max Put OI is seen at 300 strike which suggest shift of support to higher level