Shitij Gandhi
Indian market continued its bull run and gained for the fourth consecutive session on June 23.
Nifty reclaimed 10,450 and Bank Nifty moved above 22,250 on the back of strong rally seen in some of the heavyweights like Bajaj twins, ICICI Bank, Axis Bank and Reliance Industries.
On the derivatives front, put writers added hefty open interest at 10,300 and 10,400 strike while 10,500 call strike held maximum open interest concentration.
On the technical front, now Nifty would face a strong hurdle at 10,500-10,550 zone as the 200-days exponential moving average is placed on daily charts.
However, the bias is likely to remain bullish and any dip should be used to create fresh longs. Additionally, as we are approaching the expiry of the June series the volatility would likely to grip the markets in the coming sessions.
Here are three buy calls for the next 3-4 weeks.
After taking support around Rs 100, the stock made a smart recovery and once again reclaimed a move above its short term moving averages.
However, for the last four weeks, the stock has been consolidating in the range of Rs 120-145 along with consistent buying at support levels.
At the current juncture, positive divergences on secondary oscillators can be seen with a rise in price and volume, which suggests a next up-move in the prices in the coming sessions.
Traders can accumulate the stock in the range of Rs 134-137.
ICICI Bank | Buy | LTP: Rs 376.05 | Target price: Rs 415 | Stop loss: Rs 342 | Upside: 10%
The stock can be seen trading in a rising channel with the formation of higher bottoms on the daily interval.
At the current juncture, it has formed an inverted head and shoulder pattern on the daily charts and is on the verge of fresh breakout above the neckline of the pattern formation.
The stock has also managed to hold above its 200-days exponential moving average on the weekly interval as well which points towards a limited downside in the prices.
Traders can accumulate the stock in the range of Rs 370-375.
Ashok Leyland | Buy | LTP: Rs 56.30 | Target price: Rs 63.25 | Stop loss: Rs 49 | Upside: 12%
For the last more than ten trading sessions, the stock has been consolidating in the range of Rs 47-55 with prices holding well above its short-term moving averages on the daily charts.
The prolonged consolidation has formed a rectangle pattern on a shorter time frame on charts.
However, on broader charts, the stock has formed an inverted head and shoulder pattern and also managed to give a breakout above the same with prices moving above its 100-days exponential moving average on the daily charts.
Traders can accumulate the stock in the range of Rs 54-56 levels.
(The author is Senior Technical Analyst at SMC Global Securities)
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