Even though the long-term view about the market remains strong because of India’s robust macro outlook, the short-term outlook of the market continues to remain hazy. Experts see mixed cues for October.
“There are mixed cues for the October series, which historically has been a good month for markets. The major negative for the near term will continue to be the sustained FII (foreign institutional investors) selling, which touched ₹26,689 crore in the cash market in September,” said V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services.
“The dollar index rising above 107 and the US 10-year bond yield at a 16-year high of 4.68 per cent are major headwinds for the market since FIIs are likely to continue selling in response to the rising dollar and US bond yields. But, on the positive side, the bulls will be emboldened to buy on the back of the tailwind of the 5 per cent crash in Brent crude prices. Bullish DIIs and retail investors will lend support to the market. In the near term, these negative and positive factors can be expected to swing the market to and fro,” said Vijayakumar.
Also Read: The short-term market outlook hazy; how should retail investors play in this market?
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Also Read: After a volatile Indian stock market in September, what lies ahead? Know from expert
Experts advise following a stock-specific approach in the market at the current juncture. Based on the recommendations of experts and brokerage firms, below are 12 stocks for the next three to four weeks as they look sound on technical parameters. Take a look:
Gaurav Bissa, VP, InCred Equities
Dr. Lal Path Labs | Target price: ₹2,725 | Stop loss: ₹2,425
Lal Path Labs has moved sharply in the last few months and has formed a potential double-bottom pattern on the long-term charts.
The stock has witnessed a fresh breakout from inverse head and shoulder pattern on the weekly charts which is a reversal pattern in nature and can push the stock higher.
“The stock has also witnessed a breakout from a descending trendline pattern on the weekly charts with incremental volumes. ADX is trading above 24 level on the weekly charts which is likely to give a strong push to the stock price towards ₹2,700-2,800 levels,” said Bissa.
Parag Milk Foods | Target price: ₹240 | Stop loss: ₹199
Parag Milk has been one of the strongest and most consistent performers in the smallcap space. The stock has been consistently forming higher lows and higher highs which is a characteristic of an uptrend.
The stock has been taking strong support from its 21EMA (exponential moving average) on the daily charts which has been giving a strong push since May 2023.
It has witnessed a breakout from a bullish symmetrical triangle pattern on the daily charts with strong volumes suggesting further upside is possible in the coming days. RSI has picked momentum after forming a double bottom pattern on the daily charts which supports the postulate of a swift upside in the near term.
IIFL Securities | Target price: ₹97 | Stop loss: ₹82
IIFL Securities has been in consolidation since May 2022. It has witnessed a breakout recently with strong volumes suggesting the stock is ready to start a fresh uptrend.
“The stock has witnessed a bullish MACD crossover on the daily timeframe which can give a strong thrust to the stock price. The stock has witnessed a fresh breakout in point and figure charts with bullish counts at the ₹98 level,” Bissa said.
Jigar S. Patel, Senior Manager of Equity Research at Anand Rathi Share and Stock Brokers
Ramco Systems | Buying range: ₹325-330 | Target price: ₹401 | Stop loss: ₹291
On a weekly scale, Ramco Systems has taken out the Ichimoku cloud, preceded by the Tenkan Sen and Kijun Sen crossovers, which are looking lucrative. The breakout seems genuine since it is supported by a huge volume bar.
“On a monthly scale, MACD has given a bullish cross, thus hinting at further bullish bias in the counter. We advise going long in the stock in the range of ₹325-330 with a stop loss of ₹291 for the upside target of ₹401,” said Patel.
Sterlite Technologies | Buying range: ₹158-162 | Target price: ₹195 | Stop loss: ₹145
For the last three months, this counter has been consolidating in the range of ₹145-155. Recently it gave a clean breakout from the said range and it is currently placed at ₹171 level. It also cleared its downward-sloping trendline quite comfortably. The best part about this reversal is has bounced back from its monthly central pivot range which has acted as massive support.
Greenpanel Industries | Buying range: ₹375-380 | Target price: ₹440 | Stop loss: ₹345
Greenpanel Industries has been consolidating between ₹310 and ₹350 for the last three months. Recently, it gave breakouts on a weekly scale. On the daily chart, it is trading above all major daily exponential moving averages, which looks lucrative. Even the weekly RSI has rebounded from 50 levels, thus hinting at further bullish bias.
Also Read: Top 5 fundamentally strong smallcap stocks to watch out in 2024
Vaishali Parekh, Vice President – Technical Research, Prabhudas Lilladher
BHEL | Target price: ₹147 | Stop loss: ₹123
The stock has cooled off after a strong run, witnessing resistance near the ₹149 level. Recently, it flattened out to form a good support near the ₹122 level. Currently, it has indicated an improvement in the bias with positive candles in the last two sessions to indicate a further rise in the coming days.
The RSI also has cooled off significantly from the highly overbought zone and it is currently well placed to regain strength once again.
Exide Industries | Target price: ₹295 | Stop loss: ₹248
The stock has witnessed a decent rally with a strong uptrend. After peaking out near ₹280, it slightly slipped due to profit booking. It has taken support near the significant 50EMA level, forming a good base at ₹254 where it has consolidated quite well. It is well poised for further rise with signs of positive bias witnessed. The RSI is well placed currently cooling off from the overbought zone and it has indicated a trend reversal.
Larsen and Toubro (L&T) | Target price: ₹3,400 | Stop loss: ₹2,870
The stock has indicated a breakout above the consolidation phase with a series of two strong positive candles. With improvement in bias, it is expected to carry on with the positive move further ahead.
The RSI is strong with upside potential visible. It has entered into a new territory and a higher bottom formation pattern on the daily chart has made it look very promising.
Also Read: ‘Valuations of smallcaps ahead of fundamentals; tough to predict RBI rate cut’
Axis Securities
Aurobindo Pharma | Buying range: ₹908-890 | Target price: ₹1,009-1,025 | Stop loss: ₹844
Aurobindo Pharma has displayed a compelling breakout above a substantial consolidation zone spanning from ₹905 to ₹818 on the weekly chart, further validated by a notable gap up on the daily chart. This setup strongly reinforces the likelihood of a continued medium-term uptrend for the stock.
The stock is establishing a pattern of higher high-low on the weekly chart, forming an upward-sloping trendline. It has established a medium-term support level at ₹816, which corresponds to a 23 per cent Fibonacci retracement from the price range of ₹581-888.
The weekly strength indicator RSI has given a crossover above its reference line, generating a buy signal.
“The above analysis indicates an upside of ₹1,009-1,025 levels,” said Axis Securities.
Dalmia Bharat | Buying range: ₹2,370-2,323 | Target price: ₹2,600-2,700 | Stop loss: ₹2,220
Dalmia Bharat demonstrated a robust breakout from a medium-term “rounded-bottom” pattern at the ₹2,280 level on the weekly chart in the initial week of September 2023.
It retested the breakout area and bounced back sharply, affirming the continuation of the uptrend.
The stock has established a medium-term support level at ₹2,216, which corresponds to a 38 per cent Fibonacci retracement from the price range of ₹1,873-2,425.
The weekly strength indicator RSI is moving upwards and is above its reference line, indicating positive bias.
“The above analysis indicates an upside of ₹2,600-2,700 levels,” said Axis Securities.
Precision Wires India | Buying range: 135-132 | Target price: ₹147-152 | Stop loss: ₹127
On the daily chart, Precision Wires India has successfully broken out above a consolidation zone, ranging from ₹117 to ₹128, accompanied by a sizable bullish candle, which signifies the continuation of the uptrend.
The stock, currently trading within a rising channel found support at the lower band and is now trending towards the upper band, indicating a bullish momentum.
The stock is well-placed above key moving averages of 20, 50, 100, and 200 days, daily SMA, indicating positive momentum in the stock.
The weekly strength indicator RSI is moving upwards and is above its reference line indicating positive bias.
“The above analysis indicates an upside of ₹147-152 levels,” said Axis Securities.
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Disclaimer: The views and recommendations above are those of individual analysts, experts and broking companies, not of Mint. We advise investors to check with certified experts before making any investment decisions.
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Updated: 03 Oct 2023, 11:37 AM IST