Buy these two stocks for short term gains as Nifty moves closer to 17600-17700

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The upward breakout of the range move could be an encouraging factor for the bulls to make a comeback.

By Nagaraj Shetti

After showing a move related to the range over the past 5-6 sessions, Nifty resumed its upward momentum on Wednesday and showed an upward breakout of the range and closed higher. After opening on a slightly positive note, the market moved into a lasting intraday bullish trend, which continued throughout the session. Minor intraday dips in between were used to extend the day. A new all-time high was reached at 17,532 levels and Nifty closed near the highs.

A long bullish candle has formed on the daily chart indicating an upward breakout of the narrow range move of the past week. This is a positive indication and we can expect a further rise in the near term. The positive chart pattern like higher highs and higher lows is intact and the recent low of 17254 could now be seen as a new higher low in the streak. The immediate 10-day EMA support is intact and offered support for the Nifty during the recent side-reach move. Nifty on the weekly chart continued its uptrend after a break last week. This action signifies an uptrend force in the market on a larger chart.

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The upward breakout of the range move could be an encouraging factor for the bulls to make a comeback. We can expect a further rise towards the 17600-17700 levels in the coming sessions. Immediate support is placed at 17420 levels.

Buy NTPC Ltd- (CMP Rs 124.55)

After showing action linked to a wider range over the past two months, the share price moved sharply upward from the range to Rs 120-122 levels on Wednesday and closed higher . The greater degree of positive streak like higher highs and higher lows is intact on the weekly chart, indicating a medium term uptrend for the stock price. Volume rose during the bullish breakout and the 14-period weekly RSI shows a positive indication.

The buy can be initiated in NTPC at CMP (124.55), add more on declines to Rs 119, expect the target to rise to Rs 138 in the next 3-4 weeks. Place a stoploss of Rs 115.

Buy Quess Corp Ltd- (CMP Rs 901.40)

The share price on the long-term charts has been moving within a limited range over the past few weeks, before showing a bullish rebound this week. The current chart pattern indicates an attempt to break out the crucial bullish resistance around the Rs 915-920 levels. Therefore, a sustained movement above this zone could have a large positive impact on the price of the shares to come. The weekly DMI / ADX pattern indicates further strengthening of the bullish momentum for the stock price ahead.

The buy can be initiated in Quess Corp at CMP (901.40), add more on declines to Rs 870, expect the target to rise to Rs 1010 in the next 3-4 weeks. Place a stoploss of Rs 845.

(Nagaraj Shetti is Technical Research Analyst at HDFC Securities. The opinions expressed are those of the author. Please consult your financial advisor before investing.)

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