In the current market conditions, when the indices have scaled new highs too soon, and there is a high likelihood that the prices shall correct in the near future. HDFC Securities has come out with 2 stock picks for gains in the near term.
If talking in particular about the NSE 50 Nifty index it has found support at the 50 day simple moving average or SMA. And is also above the 20 Day SMA, further the short term metrics such as the 14 day RSI indicator has entered overbought zone. And so for trading positions taken for the short term, there is advised a cautious approach with stop losses to take care of the risk aspect.
PVR - Buy Target price: Rs. 1860
The multiplex stock has been climbing higher for the last few months and is reaching new higher tops and higher bottoms. Also, given the high volumes, the stock this week crossed its immediate highs. And this bodes well for the upward move for the counter.
Technical indicators also are providing positive signals as the stock trades above the 20-day and 50-day SMA. And so, the intermediate as well as long term set up for the stock shows likely upside and buy is recommended for a stock at a price between Rs. 1460-1500 levels. Stop loss is at 1320 while targets are at 1860.
Karur Vysya Bank- Buy- Target price: Rs. 60
The private sector bank of late has shown a lot of uptrend and the counter during the week surged by a huge 19 percent. Also, given the high volumes, the stock breached the 3-week trading range.
In this case also the stock trades above the 20-day and 50-day SMA. Intermediate momentum readings like the 14-week RSI too are in rising mode and not overbought.
We therefore recommend a Buy between the 43-45 levels. CMP is 44.75. Stop loss is at 38 while targets are at 60. The stock's last traded price has been Rs. 43.40 per share.