Nifty has formed a bullish candle on its weekly charts and made higher highs and higher lows for four consecutive trading sessions. Nifty gained momentum on the back of global cues and positive investor sentiments. However, high volatility was witnessed in the markets due to US elections. After a continuous rally, a healthy correction may be expected in the market. Therefore, investors should avoid aggressive longs and prefer buying on dips.
Nifty has to respect the support of 12,000 in order to continue its rally. If the index violates the support of 12,000 it will resume the downswing with initial targets in 11,900 and 11,750. Bank Nifty has to hold above 25,000 in order to test its resistance level of 27,100.
Here are few top picks for the week:
1. BUY: Bombay Burmah Trading Corporation Ltd (NS:BBRM)(ABOVE - 1260)
TARGET: 1360
STOP LOSS: 1175
This stock has formed an insider bar pattern on its weekly charts and is trading above its important moving averages. Any breakout above the level of 1260 would add further upward momentum to the stock. Therefore, we recommend initiating a buy position above Rs.1260 with a stop loss of Rs. 1175 and a target of Rs. 1360.
2. BUY: Colgate-Palmolive (India) Ltd. (NS:COLG) (ABOVE - 1512)
TARGET: 1550
STOP LOSS: 1480
This stock has given a trend line breakout in its daily charts and is trading above its important moving averages. Any breakout above the level of 1512 would add further upward momentum to the stock. Therefore, we recommend initiating a buy position above Rs.1512 with a stop loss of Rs.1480 and a target of Rs.1550.
Disclaimer: The analyst does not hold a position in any of the stocks mentioned above.