#Nifty #Futures - 'Further rise in volatility will cap any chance of bounceback'

Support for Nifty is seen at 9,952 which is March 2018 low while the further rise in volatility will cap any chances of the bounce back in the market, says Ashish Chaturmohta of Sanctum Wealth Management

The week started with a rally in equity markets. The Nifty opened in the positive and after initial hiccup added strength as the day progressed. The index finally closed at 10,251 up by 2.2 percent.

Broader indices, BSE Mid, and Smallcap gained 2.8 percent and 2.1 percent respectively for the day. Market breadth was more than 3:1 in favour of advances on NSE.

Last week, the index touched low of 10,004 and managed to hold above the psychological level of 10,000. Even after Monday's bounceback, the index is still below the rising support trendline connecting lows of 9,825 and 7,894.

Thus, crossing above 10,300, bounceback towards 10,460 can be expected. On the downside, support levels for the market are seen at 9,952 which is March 2018 low. The next support is at 9,873 which is 38.2 percent Fibonacci retracement of the rise from 6,825 to 11,760.

In Nifty options, maximum open interest for Puts is seen at strike price 10,000 followed by 9,500 and 10,200. For Calls it is seen at strike price 11,000 followed by 10,800. Some Call unwinding was seen but writing in Puts at 10,000, 10,100 and 10,200 suggested supports at lower levels.

India VIX closed at 19.71 up by 2.48 percent. It continues to remain at two- and half-year highs. A further rise will cap any chances of a bounce-back in the market.

Here are the top stock trading ideas which can give good returns in the near term:

Bata India: Buy | CMP: Rs 935 | Stop loss: Rs 900 | Target: Rs 1,060

After touching high of Rs 1,115.7 in August this year, the stock has seen a correction down to Rs 833. The decline has retraced 61.8 percent (Rs 830) Fibonacci retracement of the rise from Rs 653 to Rs 1,116.

For the last one month, the stock has been trading in the range of Rs 955 to Rs 830 and formed a bullish double bottom pattern on the daily chart. Second low of the pattern, at Rs 833, was formed just above the 200-day moving average.

Relative strength index (RSI) has given positive crossover with its average. Thus, the stock can be bought at the current level and on dips to Rs 925 with a stop loss below Rs 900 for a target of Rs 1,060.

Sterlite Technologies: Buy | CMP: Rs 368 | Stop loss: Rs 350 | Target: Rs 415

The recent decline in the stock from high of Rs 375 has tested previous lows around Rs 261 and seen a bounceback. It has formed a higher low of Rs 275 and bullish double bottom pattern on the weekly chart. The rally from the second low of the pattern has been on strong momentum indicated by long bullish candlesticks and good volumes on the daily chart.

The price has given a breakout on the upside from Bollinger Band with the expansion of bands indicating a continuation of the trend in the direction of breakout on the daily chart.

MACD line has moved above the equilibrium of zero on the daily chart. Thus, the stock can be bought at the current level and on dips to Rs 360 with a stop loss below Rs 350 for the target of Rs 415.

Aurobindo Pharma: Buy | CMP: Rs 773 | Stop loss: Rs 735 | Target: Rs  860-890

The stock has formed major double bottom formation between Rs 800 and Rs 500 on the weekly chart. After hitting high of Rs 827 on high volumes indicating buying participation in the stock; price corrected down to Rs 720 on below-average volumes indicating long positions holding in the stock.

It has seen bounceback from 38.2 percent Fibonacci retracement level of the major rise from Rs 527 to Rs 827. The rally has been on strong momentum indicated by long bullish candlestick and above average volumes.

RSI and Stochastic have given positive crossover with their respective averages on the daily chart. Thus, the stock can be bought at the current level and on dips to Rs 760 with a stop loss below Rs 735 for the target of Rs 860-890.

IndusInd Bank: Sell | CMP: Rs 1,412 | Stop loss: Rs 1,475 | Target: Rs 1,250

The stock is in decline mode forming lower tops and lower bottoms for the last three months on the daily chart. After a bounce-back initially last week, it has again seen a reversal from Rs 1,529.

The stock hit a new low of Rs 1,275 for the decline. It has given breakout from Bollinger band with the expansion of band and closed below lower band indicating a resumption of downtrend on the daily chart.

Momentum indicators are in bearish mode on the daily and the weekly charts. Thus, the stock can be sold at the current level and on rise to Rs 1,475 with a stop loss above Rs 1,480 for the target of Rs 1,250.

Ambuja Cements: Sell | CMP: Rs 193 | Stop loss: Rs 202 | Target: Rs 170

The stock has formed a triple top bearish pattern between Rs 290 and Rs 190 on the weekly chart. Last week, the stock formed bearish candlestick with high volumes indicating selling pressure in the stock. Its price is below short term as well as long-term moving averages.

Momentum indicators are in bearish mode on the daily and weekly charts. Thus, the stock can be sold at the current level and on rise to Rs 196 with a stop loss above Rs 202 for the target of Rs 170.

Disclaimer:- The views and investment tips expressed by investment experts are their own. Ripples Advisory advises users to check with certified experts before taking any investment decisions.

Best Share Market News, Click Here To Get More News - Share Market Tips, for 2 Days Free Trial give a missed call @9644405056 and Get Share Market Services.