Buy Canara Bank, United Spirits, other stocks, charts show potential rally; Nifty may hit 17450 above 17200

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By Shrikant Chouhan

The benchmark indices witnessed narrow range activity, after a volatile trading session, the NSE Nifty 50 closed at 17,345 while the BSE Sensex closed at 58,136 levels. Among sectors, PSU Bank index gained the most, rallying over 2.3 percent whereas profit booking was seen in Reality and selective IT stocks. Technically, after initial intraday correction, the indices took the support near 17200/57700 and recovered. From the day’s lowest point, the indices rallied over 175/580 points.  

The higher bottom formation on intraday charts indicating continuation of uptrend in the near future. We are of the view that, as long as the indices are trading above 17200/57700 the uptrend texture is likely to continue. Above the same, the index could move up to 17400-17450/58300-58500. On the other side, below 17200/57700, traders may prefer to exit out from the trading long positions. Below 17200/57700, the index would slip till 17150-17100/57500-57300.

Technical stocks to buy

NMDC
BUY, CMP: Rs 107.45, TARGET: Rs 114, SL: Rs 104

On the daily chart, post reversal from its multiple support zone the stock is into a gradual up move in a rising channel pattern. The texture of the chart pattern suggests upward movement from the current level is very likely to continue in the coming sessions.

United Spirits
BUY, CMP: Rs 785.45, TARGET: Rs 825, SL: Rs 767

The stock had witnessed a quite strong sell off in the last couple of trading sessions. However, the downward movement has taken a pause at the moment as the counter has found support around its important retracement zone. As a result, the pullback rally from the current levels is expected to move up in the near future.

Canara Bank
BUY, CMP: Rs 233.2, TARGET: Rs 245, SL: Rs 227

For the past few sessions, the stock is into a range bound mode with a higher low series formation. Meanwhile, on the daily scale, it has formed a triangle chart pattern. The breakout along with the rising volume indicates at the beginning of a new up move in the counter.

Persistent Systems
BUY, CMP: Rs 3,623.55, TARGET: Rs 3,800, SL: Rs 3,550

On a broader time frame, the counter is consolidating in a range bound mode after witnessing the correction phase. In addition, the bullish activity on daily charts near its upper boundary of the trading range indicates that the counter could start its fresh up move from the current levels.

(Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities. Views expressed are the author’s own.)

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