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Top stock picks by CapitalVia Global Research: Buy Marico, ICICI Bank

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Market traded in close range on Friday; 12,000 would be crucial for next week

Market traded in a close range on Thursday as traders turned cautious ahead of an extended weekend since equity markets remained closed on Friday due to Mahashivratri. The Nifty closed at 12,080.90 on Thursday, shedding 45 points. PSU banks, Metal and Private banks traded with positive sentiments whereas IT and FMCG stocks traded with weakness. Nifty bank closed at 30,942.85, adding 104.65 points from the previous day’s closing.

 
As per the weekly option data, handful of call writing on higher strikes ranging from 12,100 to 12,200 is seen which shows Nifty is witnessing resistance in sub -12,150 zone. Traders should try to buy any dip as market has maximum put open interest (OI) at 12,000 which will act as major support for weekly expiry and 12,200 will act as resistance as maximum OI for the calls stands here. We can witness short-covering move along with addition of fresh position only if the Nifty is able to breach 12,200. Therefore, traders should try to buy any dip keeping close eye on 12,000.

 
We can see a big momentum in following stocks: 

Buy: Marico Limited (Above Rs 307.25)

Target:  Rs 327

Stop loss:  Rs 296

The stock is witnessing bullish divergence on daily charts. Further strength in stock could result in a bullish movement. Breakout from the level of 307.25 might lead stock towards its next resistance zone.  Considering the technical evidence discussed above, we recommend buying the stock above 307.25 for the target of Rs 327, keeping a stop loss at Rs 296 on a closing basis.

 
Buy: ICICI Bank Limited (Above Rs 550)

Target: Rs 573

Stop loss: Rs 535

The stock is forming a bullish flag pattern in daily charts, resistance breakout from the level of 550 would lead stock to hit its 52-week high placed at Rs 552.20. Sustaining above Rs 550 will lead to more bullish movement. We recommend buying the stock above Rs 550 for the target of Rs 573, keeping a stop loss at Rs 535 on a closing basis.

Disclaimer: The analyst does not hold position in any of the stocks mentioned above.


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