Trade Spotlight: How should you trade IIFL Finance, JSW Energy, UNO Minda, NLC India, Ashok Leyland, Lodha Developers, and others on October 08?
The market maintained its uptrend for four days on the trot, though there was profit booking in the late hour of trade. The market breadth was weak for another session, with 1,585 shares declining compared to 1,234 advancing shares on the NSE. Overall, the trend remains favourable for bulls, but some consolidation can't be ruled out given the healthy rally in the last few sessions. Below are some short-term trading ideas to consider:
Amol Athawale, VP technical Research at Kotak Securities
TCS | CMP: Rs 2,973.7
After the short-term correction from higher levels, the downward momentum had stopped, and the stock consolidated for a few sessions. On the daily charts, it has formed a rounding bottom chart formation and reversed its trend from its important demand zone.
The structure suggests a revival of the uptrend from the current levels in the near future. For traders, Rs 2,905 would be the key support level to watch. Above this, the uptrend structure could continue towards Rs 3,120.
Strategy: Buy
Target: Rs 3,120
Stop-Loss: Rs 2,905
Lodha Developers | CMP: Rs 1,145
Post the decline from higher levels, Lodha Developers rebounded from its support zone and witnessed a sharp recovery from the lower levels. Additionally, on the daily charts, the stock has given a breakout from its sloping channel formation. The up moves suggest a new leg of a bullish trend from the current levels.
For the next few trading sessions, Rs 1,105 could be the trend-decider level for the bulls. If it sustains above this, we can expect a further uptrend towards Rs 1,225.
Strategy: Buy
Target: Rs 1,225
Stop-Loss: Rs 1,105
Ashok Leyland | CMP: Rs 139.83
After the remarkable up move, Ashok Leyland has been taking a breather over the last few sessions. The consolidation structure suggests a bullish continuation chart formation. Moreover, the stock comfortably closed above its short-term moving average.
Therefore, the stock is likely to resume its uptrend from the current levels in the coming horizon. As long as the stock is trading above Rs 133, the bullish texture is likely to continue. Above this, the stock could move up to Rs 150.
Strategy: Buy
Target: Rs 150
Stop-Loss: Rs 133
Ashish Kyal, CMT, Founder and CEO of Waves Strategy Advisors
IIFL Finance | CMP: Rs 475.5
On the daily chart, since September 29, IIFL Finance has managed to protect its prior day’s low on a closing basis and has consistently closed in the green since then, which keeps the overall bias in favour of the bulls. As of now, prices have managed to close near their previous swing high of Rs 475, and with follow-up buying, a move towards Rs 538 is expected, which is the next important resistance.
Along with this, the 15 EMA and 30-period EMA have recently witnessed a bullish crossover, which further reinforces the positive outlook in the stock. For now, a break above Rs 487 can further accelerate positive momentum.
Strategy: Buy
Target: Rs 510, Rs 538
Stop-Loss: Rs 464
JSW Energy | CMP: Rs 548
In the previous session, JSW Energy managed to outshine its sector with a gain of more than 1%, which is a bullish sign. Prices also recently found support at the mid-Bollinger bands and reversed to the upside, pushing prices to trade near the upper Bollinger bands, highlighting strength in the ongoing trend.
The stock is also on the verge of giving a breakout of the Triangle pattern, which also happens to be an upper band resistance area. So, a break above Rs 558 levels can trigger a fresh course of buying. Along with this, the MACD has recently shown a bullish crossover, acting as a double confirmation for our stance.
Strategy: Buy
Target: Rs 580
Stop-Loss: Rs 615
UNO Minda | CMP: Rs 1,366.3
UNO Minda has been moving in a higher high and higher low formation, as depicted by the upward sloping trendline, which keeps the daily bias on the buy side as per Dow Theory. In the previous session, the stock finally managed to give a breakout of its consolidating range of Rs 1,260 to Rs 1,349, with a gain of more than 2%, supported by a surge in volumes, which is a positive signal.
Moreover, not a single candle since September 29 has managed to close below its prior day's low, which highlights buying pressure from lower levels. For now, follow-up buying is required for this up move to continue. Along with this, the ADX is trading at 34 levels, suggesting good momentum is expected to continue in the stock.
Strategy: Buy
Target: Rs 1,400, Rs 1,440
Stop-Loss: Rs 1,305
Nandish Shah - Deputy Vice President at HDFC Securities
NLC India | CMP: Rs 283.4
The price has broken out from a twenty-month consolidation with higher volumes to close at all-time high levels. The price rise is accompanied by a rise in volumes, suggesting strength in the uptrend. Momentum indicators and oscillators are showing strength in the current uptrend of the stock.
Strategy: Buy
Target: Rs 308, Rs 320
Stop-Loss: Rs 260
Stylam Industries | CMP: Rs 1,823.8
Accumulation was seen in Stylam Industries during the last few months, where up-day volumes were sharply higher than down-day volumes. The primary trend of the stock turned positive as it closed above its 200-day EMA. Momentum indicators and oscillators like RSI and MFI are in a rising mode and are placed above 60 on the daily chart, suggesting strength in the current bullish trend.
Strategy: Buy
Target: Rs 1,970, Rs 2,050
Stop-Loss: Rs 1,700
Union Bank of India | CMP: Rs 138.54
The short-term trend is positive, as the stock price is placed above its 5-day and 11-day EMAs. The stock is on the verge of breaking out from the symmetrical triangle on the daily chart. PSU banks as a sector are strongly placed on the short-term charts.
Strategy: Buy
Target: Rs 146, Rs 151
Stop-Loss: Rs 132Disclaimer: The views and investment tips expressed by experts on Moneycontrol are their own and not those of the website or its management. Moneycontrol advises users to check with certified experts before taking any investment decisions.