Nifty has gained for three consecutive weeks and is trading well around the 12,800-mark; how are things looking from here on?
Nifty some resistance near 13,000-mark but the trend is quite positive. As long as Nifty is sitting above 12,700, any correction would be a great buying opportunity. We saw a lot of buying interest at lower levels near 12,700 mark and I believe after some consolidation, we can break the 13,000-mark and it can go up and touch 13,200.
I am still bullish on the Nifty and at current levels, one can take a long position in the Nifty. Keep your stop loss below 12,700 and for the next week and your target near 13,200.
Do you think further underperformance is on cards for Reliance or is there a chance for a bounce in the near term?
Reliance is trading very close to its 200-day moving average which is near to Rs 1,800 mark. The stock has seen a big rally between April to September. It has moved from the level of around Rs 1,100 to almost Rs 2,300. So, this correction is totally justified. I believe the stock will not go below its 200-day moving average. So, if you have to create long positions for a little bit, say for the next two to three months, then definitely this is a great opportunity. You can take a long position in Reliance at the current levels, keep your stop loss below Rs 1800-mark so your risk is almost Rs 100 but on the upside, in the next two to three months, Reliance can again come back in the range of Rs 2,250 to 2,300.
What are your top picks now?
I have two buy recommendations. First is a buy call on Bharti Airtel because we have seen some correction but the bounce back on Friday has helped the stock break its 200-day moving average. You can take a chance, take a long call here; the stop loss should be around Rs 474 with a target of around Rs 505. Second is a buy call on Gas Authority. The stock has given a flag breakout on the hourly chart and the is trading very near its 200-day moving average. So take a long position here with a stop loss Rs 95 and target price of Rs 102.50.