It has been a terrible week as the Nifty broke below the crucial psychological support level of 11,000.
However, the late intraday recovery towards the end on August 01 saw the Nifty forming a ‘Hammer’ like candle pattern after a sharp fall. The pattern, when formed, usually indicates a reversal of the trend. But, the reversal will only be confirmed after the Nifty manages to surpass the 11,080 zone.
Bank Nifty too formed a ‘Hammer’ candle pattern on the daily chart. It found support near 28,400 zone which indicates recovery may be in sight at least in the near-term.
Here is a list of top three stocks which could give 5-7 percent return in the next three to four weeks:
Power Grid: Buy| Target: Rs 230| Stop Loss: Rs 207| Upside 7.5 percent
The stock has shown a strong momentum and has been gaining decent ground despite the heavy selloff in the overall market.
Power Grid has broken out from a consolidation base on the daily chart. The breakout was accompanied with a smart uptick in traded volumes. Investors can hold on to long positions with the mentioned stop loss on a weekly closing basis.
Bharti Airtel Aug Futs: Sell| Target: Rs 309| Stop Loss: Rs 333| Downside 5 percent
The stock has been under immense pressure for the past two trading sessions and has finally broken below its crucial previous lows of Rs 328.
The stock closed below its 100-DMA support area which is a negative sign for the bulls. Traders can hold on to short positions with the mentioned stop loss on a weekly closing basis.
Tata Global Beverage: Buy| Target: Rs 277| Stop Loss: Rs 250| Upside 7 percent
The stock has shown immense resilience and finally broken out from the 'Falling channel' pattern on the daily chart.
The stock has also managed to surpass its 50-DMA resistance zone indicating a resumption of the higher top, and higher bottom structure. Traders can hold on to the long positions with the mentioned stop loss on a weekly closing basis.
(The author is Senior Technical Analyst at IIFL)
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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