Infosys has bounced from the bullish harmonic bat pattern and can test Rs 740-750 zone.
It has strong resistance at Rs 760 and a fresh up move is expected only if this level is held, S Ranganathan, Head of Research, LKP securities, said in an interview with Moneycontrol’s Kshitij Anand.
Q: Bears remained in control of D-Street in the week gone by. We saw plenty of support near 100-EMA and some bit of resistance at 11600 on the higher side. What are the levels you are mapping for the index in the coming week?
A: The Nifty50 has witnessed strong selling around 11,620-11,630 levels where 89-day moving average (DMA) is placed. 11,600 CE has accumulated good open interest (OI) implying that the Nifty could face strong hurdle at those levels.
On the hourly charts, the index has reversed from Ichimoku resistance. The next line of support is seen at 11,450 levels which if broken can result in incremental pressure on the downside. The overall range is expected to be 11,425-11,625 levels in the coming week.
Q: Important trigger points to watch out for in the coming week? Investors will react to Infosys numbers as well as WPI data? What is your view on both TCS and Infosys?
A: Infosys has bounced from the bullish harmonic bat pattern and can test Rs 740-750 zone. It has strong resistance at Rs 760 and a fresh up move is expected only if this level is held. TCS is forming a bullish harmonic ab=cd pattern. It can be bought at CMP and dips to Rs 2,065 for Rs 2,200+ levels
Q: SEBI at it board meeting held on 27th June 2019 mandated that where pledging of promoters (and PACs) is more than 20 percent of the Total Share Capital of the company or 50 percent of the Total Promoter Holding, promoters shall be required to disclose detailed reasons for encumbrance separately. As on 30th June 2019, there were 265 such companies listed on NSE. What should investors do?
A: When Promoters pledge more than 50 percent of their shareholding the risks associated is always high for investors and we have had a number of illustrations in the past to prove this point. Hence, we would surely be skeptical of investing in such companies.
Q: About 300 companies in BSE 500 are trading below their 200-DMA which include names like MRF, Page Industries, Eicher Motors, Maruti Suzuki, Bajaj Auto, Hero MotoCorp, Tech Mahindra, Cipla, Tata Steel, Sun Pharma, etc. among others. Some of the names are top marquee names in Nifty50 -- are they attractive buys at current levels? Or investors should wait for the trend to reverse before pushing the buy button?
A: Some of the above stocks look attractive at current levels but its recommend to use the mentioned levels as follow:
Maruti Suzuki formed bullish shark harmonic pattern on the daily chart can be bought for the targets of Rs 6,200-6,300 zone with keeping stop out level below Rs 5,800.
Bajaj Auto has given a good double bottom breakout on weekly chart suggesting prices can see a pullback any time soon, can initiate longs with keeping stop out below Rs 2,550 target will be Rs 2,900-3,000 zone.
Tech Mahindra looks attractive near Rs 650 zone as stock is forming Alt shark along with bullish AB=CD pattern. Sun Pharma can be good above Rs 410 levels avoid at current levels.
Q: The trend remains strong for 200 stocks which include names like Shree Cements, Nestle India, Bajaj Finserv, UltraTech Cement, Bajaj Finance, DRL, HUL, Divi’s, L&T, RIL, Bata India, etc. among others. Are they attractive buy ideas as the momentum remains strong in these stocks?
A: In the above list, I prefer to stay long in UltraTech Cement as it has given a good double bottom breakout on the weekly chart, along with it I will prefer L&T as it has given strong break above 1,440 zone and Bata India.
Disclaimer: The views and investment tips expressed by investment expert on Moneycontrol.com are his own and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
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