By Subash Gangadharan
Nifty Daily chart indicates the index has reversed its recent downtrend as it has crossed the previous swing high of 17309 and has closed above 50 day SMA. The 14-day RSI too has made a higher bottom, bounced back and closed above its 9-day EMA. We, therefore, expect the Nifty to gradually move higher in the coming sessions. It is important that on any corrections, the short-term trend reversal levels of 17244 hold.
BSE has shown relative strength this week. While the Nifty index has gained 4.03% this week, BSE has gained a healthy 5.63% over the same time period. In the process, the stock has also broken out of its recent trading range on the back of above average volumes.
Technical indicators are giving positive signals as the stock trades above the 20 day and 50 day SMA. Daily momentum indicators like the 14-day RSI too have bounced back and are in rising mode now, which augurs well for the uptrend to continue.
With the intermediate technical setup looking positive, we believe the stock has the potential to move higher and take out its previous intermediate highs in the coming weeks. We therefore recommend a buy between the 2060-2100 levels. CMP is 2081.95. Stop loss is at 1925 while targets are at 2400.
Buy PolyplexTarget: Rs 2200 per share
Polyplex is in an intermediate uptrend as it continues to make higher tops and higher bottoms over the last several months. After correcting recently and finding support at the 1691 levels, the stock has bounced back over the last two weeks on the back of decent volumes. On Wednesday, the stock broke out of its recent trading range on the back of above average volumes.
Technical indicators are giving positive signals as the stock trades above the 20 day and 50 day SMA. Daily momentum indicators like the 14-day RSI have bounced back and are in rising mode now. The Relative Strength Comparative indicator too is beginning to move higher, indicating the stock is likely to outperform the Nifty in the coming sessions.
With the intermediate technical setup looking positive, we believe the stock has the potential to move higher in the coming weeks and therefore recommend a buy between the 1900-1950 levels. CMP is 1925.1. Stop loss is at 1800 while targets are at 2200.
(Subash Gangadharan is a Senior Technical and Derivative Analyst at HDFC securities. Views expressed are the author’s own. Please consult your financial advisor before investing.)