August16, 2015
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Market View NIFTY (8518): The week passed by remained quite disappointing for market participants, after posting a swing high of 8621.55 on Monday, Nifty corrected sharply and after four days of continuous drubbing, witnessed smart recovery on Friday. Lastly week ended at 8518.55 with marginal cuts of 46.05 or 0.54% on closing basis. The week started on a pessimistic note, as logjam in parliamentary sessions remained major concern, sentiments were also weighed down after Indian rupee reversed its gains to slip near the key 65 per dollar mark against the US dollar on the back of unexpected devaluation of Yuan. The relief came with report that India's retail inflation easing to 3.78% in July from 5.40% in June, and growth in factory output accelerated to 3.8% in June from 2.5% in the previous month which strengthened the case for an interest rate cut soon. While the positive sentiments picked up on Friday after Wholesale Price Index (WPI) inflation contracted further in July 2015 to (-) 4.05% from (-) 2.4% in June which is 9th straight monthly fall in wholesale inflation also supported by the fact that government keeping its options open on convening a special session of Parliament for enacting the GST law. From last one month Nifty is tangling between broader range of 8300 to 8650, and breakout on either side will trigger further momentum of another 100-150 points in the same direction. In the last week Nifty after posting a low of 8337.95 witnessed smart recovery and it is likely to retest zenith of 8650. Technically, Nifty closed above its 21 & 50-DEMA and also it is well placed above its major 200-DEMA exhibiting support. Overall in absence of major trigger, we expect Nifty will continue to trade in a broader range of 8300to 8650 levels, and buying a on dips would be recommendable. 3
List of Stocks STOCK SECTOR CMP ACTION ENT SL TGT VIEW ASIANPAINT CONSUMER DURABLES 895.25 BUY 895 860 950 HCLTECH SOFTWARE 973.70 BUY 970 929 1035 HDFCBANK PRIVATE BANKING 1101.80 BUY 1100 1067 1155 STAR PHARMA 1301.80 BUY 1300 1245 1383 SKSMICRO FINANCIALS 539.55 BUY 540 513 581 APOLLOHOSP PHARMA 1352.45 SELL 1360 1420 1265 APOLLOTYRE TYRES 191.95 SELL 192.30 202.50 174 HINDZINC METALS 145.40 SELL 145.50 155 129 Refers to (if any call is not initiated, entry levels for the recommendation(s) will be sent on the trading terminal(s) CMP: Current Market Price ENT : Entry SL: Stop Loss TGT: Target * The stock is in ban in F&O segment, can take positions only in Spot market. 4
BUY ASIANPAINT CMP:895.25 Sector : CD Entry 895 Stop Loss 860 Target 950 21-DEMA 867.96 50-DEMA 832.41 Open Interest Shares 3751500 Weekly Change in OI -0.38% CoC( % ) 13.17 ASIAN PAINTS is in the cycle of higher highs and higher lows on daily, indicating the stock is in uptrend. ASIAN PAINTS is one of the out performers in Nifty, which is evidenced by the fact that this stock is at life time highs, where as Nifty is still trading around 6.50% below its life time highs. In its recent correction, the stock found good support at its previous swing high zone of 860 levels, and resumed its uptrend. The volumes on the correction are also low when compared with volumes on the up move, indicating the stock is in the hands of strong hands. Over last two sessions, as per the derivative data, the stock s current month futures has witnessed a long addition. Hence a buy with stop loss below the said lows of 860 for targets into unchartered territory. 5
BUY HCLTECH CMP: 973.70 Sector : SOFTWARE Entry 970 Stop Loss 929 Target 1035 21-DEMA 952.36 50-DEMA 963.04 Open Interest Shares 7358000 Weekly Change in OI -2.52% CoC( % ) 7.49 HCLTech has given a breakout to the cluster of moving averages trading between 940-956 levels during the last week. On the daily chart, the stock is taking support of the upward sloping trendline drawn from the low of Rs. 835.10 made on 21 st April 2015. Among the oscillators, the 14-day RSI is trading in the comfortable zone above the signal line pointing northwards. The MACD is hovering around the zero line trading along the mean line giving an excellent opportunity to buy at current levels. On the derivatives front, the stock has seen closure of short positions to the tone of 2.52% during the last week with a price gain of 3.66%. Thus, one may go long with aforementioned levels from a one week perspective. 6
BUY HDFCBANK CMP: 1101.80 Sector : BANKING Entry 1100 Stop Loss 1067 Target 1155 21-DEMA 1091.79 50-DEMA 1076.22 Open Interest Shares 31009500 Weekly Change in OI 2.43% CoC( % ) 9.55 The stock has been in up trend forming higher highs and higher lows from the swing low of 931.74. After making a swing high of 1128 the stock has retraced towards the support zone 1070-80 zone where the stock is finding support near its 51 DEMA. The lower daily Bollinger band is pegged at 1075.5 levels further validating the support zone near 1070-1080 zone. On oscillator front the 14 days-rsi is hovering around 55.5 indicating that correction was just a pause in the larger up trend. On weekly charts the 14 days-rsi is still above its 9 days EMA indicating a bullish bias and the support zone has acted as a reversal area of the immediate down trend from the highs of 1128. 7
BUY STAR CMP: 1301.80 Sector: PHARMA Entry 1300 Stop Loss 1245 Target 1283 21-DEMA 1273.36 50-DEMA 1230.13 Open Interest Shares 2878250 Weekly Change in OI -1.90% CoC( % ) 12.50 The stock is in secular uptrend with higher highs and higher lows in weekly chart as well as in daily chart. The stock is trading above its 21/50/100/200 Day EMA levels indicating strength in the counter in all time frames. The 14 day RSI is quoting at 57.18 and it is just moving above the 9 day average indicating positive momentum in the counter. Other leading indicator Heiken candlesticks indicates beginning of fresh uptick in the stock. Parabolic SAR is trading below the CMP and it indicate the positive trend in the stock. On Bollinger bands in daily charts the price is moving northwards after testing the mean indicating positive momentum in the counter. 8
BUY SKSMICRO CMP: 539.55 Sector : FINANCIALS Entry 540 Stop Loss 513 Target 581 21-DEMA 538.91 50-DEMA 515.25 Open Interest Shares 4850000 Weekly Change in OI 32.57% CoC( % ) 14.31 The stock is in secular uptrend with higher highs and higher lows in weekly chart. However it was in short term corrective phase from its 52 week high of 589.6 to505.4 levels. Stock has formed hammer candlestick pattern in weekly chart indicating that the reversal of its short term corrective trend.the stock is trading above its 21/50/100/200 Day EMA levels indicating strength in the counter in all time frames. The 14 day RSI is cooled off from over bought levels to 40.29 levels and again started moving to 51.95 levels indicating a fresh leg of up movement. Other leading indicator Heiken candlesticks indicate the beginning of fresh uptick in the stock. On Bollinger bands in weekly charts the price is moving northwards after testing the mean indicating positive momentum in the counter. 9
SELL APOLLOHOSP CMP: 1352.45 Sector : PHARMA Entry 1360 Stop Loss 1420 Target 1265 21-DEMA 1368.16 50-DEMA 1335.14 Open Interest Shares 605500 Weekly Change in OI 11.56% CoC( % ) 12.87 Apollo Hospital has moved below its previous minor swing highs zone of 1378-1405, indicating the stock can slide further in the near term. Adding to the weakness, the stock is getting resisted at its previous major life time and swing highs zone of 1450-1475 and also formed a outside bar (Bearish Engulfing) pattern at the said levels, indicating the change in short term trend to down. The stock also have an unfilled gap on daily chart at 1419-1430 levels, which might act as resistance for any pullback rally in the near term. On the derivative front, the stock s current month futures has witnessed a short built up through out the week which is evidenced by the increase in OI and decrease in price. 10
SELL APOLLOTYRES CMP: 191.95 Sector: TYRES Entry 192.30 Stop Loss 202.50 Target 174 21-DEMA 195.86 50-DEMA 188.90 Open Interest Shares 12756000 Weekly Change in OI -11.67% CoC( % ) 8.04 The stock has seen a lower top at the highs of 223.4 and has see a sell off from there towards 180. from there the stock is currently witnessing a dead cat bounce. The stock has seen huge volume on the fall and volume is lower on the rise indicating a weak rally. The stock is trading well below its middle Bollinger band which is pegged at199.9 The derivative data suggests, closure of long positions to the tone of 11.67% during the last week with fall in price by 9.46% support our bearish view on the stock. Hence we recommend traders to sell short the stock at 192.3 for a target of 174 with a stop loss of 202.50. 11
SELL HINDZINC CMP: 145.40 Sector : METALS Entry 145.40 Stop Loss 155.00 Target 129.00 21-DEMA 155.69 50-DEMA 160.80 Open Interest Shares 3142000 Weekly Change in OI 6.15% CoC( % ) 12.55 Hindzinc has declined over 6.47% last week with notable volumes. The stock has given breakdown confirmation of Descending channel pattern on daily charts. This tends to show that the security is likely witness selling pressure in coming trading sessions. On weekly charts the price is making lower lows and lower highs indicating that the demand for the stock is decreasing and downside momentum is likely to become stronger. The security is currently trading well below its major moving averages, which adds weight to our bearish sentiment. Overall the metal space is looking weak. Derivative date suggests that short addition has been witnessed with 6.15% increase in open interest and 6.47% decline in price.. 12
Previous Week s Evaluation STOCK ACTION INTITIATED @ STOP LOSS TARGET RETURN (%) WEEKLY HIGH WEEKLY LOW OUTCOME AXISBANK BUY 581.00 558 613-3.96 584.70 554.85 SLT BPCL BUY 965.00 919 1018-4.77 979.55 857.80 SLT TATACOMM BUY 444.00 428 468-3.60 452.80 413.65 SLT TCS BUY 2560.00 2480 2660 3.91 2719.35 2542.10 TA JUSTDIAL SELL 1043 1095 980 2.41 1066.80 1005.00 MCLEODRUSS SELL 219.5 227 200 8.43 220.40 194.00 Closed @ 1017 Closed @ 201 RELCAPITAL SELL 385.50 398 360 6.61 388.20 333.50 TA TATACHEM SELL 473 491 450 4.86 477.50 450.00 TA Average Return : 1.74 % *TA: Target Achieved SLT: Stop loss Triggered 13
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